The Lord Chancellor: Leave of Absence

Lord Falconer of Thoroton: My Lords, before business begins, may I take the opportunity to inform the House that I will be undertaking a ministerial visit to Coventry on Tuesday, 9th September? Accordingly, I trust that the House will grant me leave of absence.

House of Lords: Members' Interests

Lord Pearson of Rannoch: asked the Leader of the House:
	Whether, in the light of current practice concerning declarations of interest, any noble Lord who has been, or is, in receipt of any emolument or pension from the European Union or from any organisation funded by the European Union should declare it when speaking in debate involving the United Kingdom's relationship with the European Union.

Lord Williams of Mostyn: My Lords, Members must declare any interest which is relevant to the matter under discussion. The test of relevance is whether it might reasonably be thought by the public to affect the way in which Members discharge their parliamentary duties. It is for each Member to decide what to declare. The Committee for Privileges is due to set up a review of the code this autumn, and any noble Lord can submit appropriate suggestions to that review.

Lord Pearson of Rannoch: My Lords, I am grateful for that helpful reply from the noble and learned Lord. But is he aware that EU Commissioners and staff are bound to owe allegiance solely to the EU, ignoring the interests of their country; and that they may lose their pension if they let the side down, even after they have retired? Furthermore, does the noble and learned Lord agree that, if a noble Lord is employed by or gets a pension from, say, an insurance company and we were debating the City of London, he would have to declare that interest? What is the difference between that situation and the one referred to on the Order Paper?

Lord Williams of Mostyn: My Lords, I was not aware of the particular relationship between former employees of the European Union or any of its institutions, because I have never been in that blest capacity. I think the answer to the noble Lord's concerns is to be found in that admirable code which your Lordships approved so recently by an overwhelming majority of three. If the noble Lord is in any doubt at all, he can go and talk to the registrar informally and have guidance. I really do think that that is the best way to proceed rather than laying down overly prescriptive rules.

Lord Richard: My Lords, having listened to the noble Lord, Lord Pearson of Rannoch, for some years now, I do not think that I have ever heard such a load of nonsense from his lips as I just did. The idea that there is some residual allegiance in me to the Commission as opposed to doing my job here in this House is, frankly, absolute nonsense. I shall say only one thing in relation to the Question as opposed to the nonsense from the noble Lord. Presumably if this applies to the Commissioners, it will apply to everyone else. Everyone in this House, therefore, will have to declare whether they have a pension and, if so, what is the basis of that pension; and indeed whether they still owe allegiance to the body paying the pension. That would be a very interesting development.

Lord Williams of Mostyn: My Lords, sometimes the noble Lord does talk a lot of Rannochs.

Lord Marsh: My Lords, I declare an interest as the recipient of an insurance company pension. Does the noble and learned Lord accept that, by definition, by the time one becomes a pensioner, the amount of influence that one can exert on those paying the pension is nil minus?

Lord Williams of Mostyn: My Lords, speaking as a prudent investor in Equitable Life, I am only too aware of that.

Lord Wallace of Saltaire: My Lords, is the noble and learned Lord aware that the Bruges Group pamphlet from which the noble Lord, Lord Pearson of Rannoch, has drawn much of his evidence, describes the European Union as an alien power and those who receive emoluments from it in this country as an intellectual fifth column? Is he aware that the Bruges Group pamphlet identifies the focus for this intellectual fifth column as being partly placed in the London School of Economics and partly in Manchester University?

Lord Williams of Mostyn: My Lords, so, plainly, it is all true.

Lord Pearson of Rannoch: My Lords, I was not sure that I heard an answer from the noble and learned Lord to his noble friend Lord Richard—perhaps because I am not sure that the noble Lord phrased a question. Could I phrase a further question to the noble and learned Lord following on from the intervention of the noble Lord, Lord Richard? Would it not be a good idea for the Government and those involved in the declarations of interest in this House to read the staff regulations of the European Union: Title II, Articles 11, 12 and 16; and in Title VI, which refers to disciplinary measures, Article 86.1 and 86.2, and particularly paragraph (g), which confirms exactly what I have said about letting the side down and losing your pension?

Lord Williams of Mostyn: My Lords, I am not sure that the noble Lord has asked me a question, but he has certainly illuminated matters satisfactorily.

Lord Clinton-Davis: My Lords, as someone who has a pension from the EU, perhaps I may say that the supplementary question was even worse than the original.

Lord Williams of Mostyn: My Lords, perhaps we have all had too short a holiday.

Lord Hannay of Chiswick: My Lords, does the noble and learned Lord agree with the noble Lord, Lord Richard, that the basic thrust of the Question asked by the noble Lord, Lord Pearson of Rannoch, is that he wishes all Members of this House in receipt of pensions to declare them, no matter where they are from—and there are many Members in receipt of pensions, and many of them are no doubt from Her Majesty's Government? To what purpose? Would the noble and learned Lord see any purpose whatever in that, or any distinction between that situation and the pensions from the European Union?

Lord Williams of Mostyn: My Lords, I think that the noble Lord has a good point. With the code we were looking to get a proportionate response to perceived malpractices, or to conceivable malpractices. By and large, we achieved that with a light touch. That is not to prevent anyone setting up Aunt Sallies and then knocking them down, but the code of conduct has little to do with whether one supports the Bruges Group on the one hand or such an institution as the London School of Economics on the other.

NHS Dental Treatment

Baroness Gardner of Parkes: asked Her Majesty's Government:
	Whether the availability of National Health Service dental treatment satisfies the needs of patients.

Lord Warner: My Lords, no. That is why, a year ago, the Government published the report of the Options for Change working group, representing all stakeholders, including the British Dental Association and patients' groups. The proposals will be implemented through the Health and Social Care (Community Health and Standards) Bill that we will debate later today. The changes will enable primary care trusts to commission the NHS dental services that their communities need and provide incentives for dentists to offer dentistry to NHS patients.

Baroness Gardner of Parkes: My Lords, I wish the Minister a happy birthday. I am sorry that I have to be so nasty on his birthday, but is it not time that the Government stopped talking about dentistry and did something about it? Here is yet another paper and yet another consultation, but I have been asking questions about this matter since we got a Labour government in 1997 and, indeed, long before that. Going back to 1997, we have heard constant promises that dentistry is going to improve, yet we have seen a situation in Wales where 600 people have been queuing because a dentist is prepared to accept national health patients. Really, yet another paper is not good enough or soon enough.

Lord Warner: My Lords, I am grateful to the noble Baroness for her good wishes. I can think of no better way of spending my birthday than in the company of your Lordships.
	On the subject of whether things have got better or worse, I should point out to the noble Baroness that the number of dentists working in general dental services increased by 30th September 2002 to 18,400, compared with 16,700 in 1997. The action that we are taking in the Bill will totally reconstruct the remuneration arrangements for dentists, which are fully supported by the British Dental Association. We are taking positive steps by moving the Bill in your Lordships' House today.

Lord Clement-Jones: My Lords, I add to the good wishes expressed by the noble Baroness, and hope that the Minister will find time for some celebration today, despite the Second Reading of the Health and Social Care (Community Health and Standards) Bill.
	Many dentists are concerned about the proposals in the Bill to transfer responsibility for dentistry to primary care trusts, on the basis that the funding of dentistry will be much more uncertain, and there is no duty on primary care trusts to ensure universal access to NHS dentistry. How do the Government therefore propose to prevent a continual movement of dentists into the private sector?

Lord Warner: My Lords, we have already taken some initiatives with personal dental services pilots, which now provide about 2 per cent of NHS dentistry and cover nearly 1,000 dentists, who are providing on a salaried basis to patients. The proposals in the Bill are warmly welcomed by the British Dental Association, and we will transfer to the base budgets of primary care trusts the £1.2 billion of financial resources currently held centrally for primary dental services.

Baroness Sharples: My Lords, has there been an increase in hygienists since 1997?

Lord Warner: Yes, my Lords, there has.

Lord Campbell-Savours: My Lords, my noble friend has just given the House some interesting information—that there has been a dramatic increase in the number of dentists available since 1997. If that is the case, why is there a crisis in some parts of the country, such as Cumbria?

Lord Warner: My Lords, the answer to my noble friend is that not all dentists are spending all their time on NHS treatment. Part of the problem with the present remuneration system, which as I recall ran pretty well unchanged under the previous Conservative government, is that the money follows the dentists wherever they happen to locate themselves. That is what we are changing in the Bill that we will be debating today.

Lord Trefgarne: My Lords, is there any plan for dentists to be able to call themselves "doctor", even if they do not have a doctorate, as is the case with general practitioners?

Lord Warner: My Lords, I am not aware of any plans being cooked up in Richmond House.

Baroness Finlay of Llandaff: My Lords, given the shortage of dentists working in the NHS and the knowledge that it is the younger dentists who tend to work in the NHS, are the Government taking any measures to avoid penalising those dental schools that find themselves over-supplied with people for the first year as a result of the high level of achievement at A-levels, where all the students have achieved the entry requirements?

Lord Warner: My Lords, a working group is considering the whole issue of workforce planning, and we shall make its report available in the not-too-distant future. That may be one of the issues that the group considers but, if not, I shall check and write to the noble Baroness.

Lord Colwyn: My Lords, would the Minister agree that the provision of dental services is very much dependent on those who serve? When is the English workforce review, which was promised and announced by the noble Lord, Lord Hunt, in 2001, likely to be finalised and reported?

Lord Warner: My Lords, I am advised that it will be published before the end of this year.

Lord Wedderburn of Charlton: My Lords, has my noble friend recently tried to find a National Health Service dentist?

Lord Warner: My Lords, I have been so well looked after by dentists in the past that I have actually had no need for dental treatment.

Earl Howe: My Lords, may I add my good wishes to the noble Lord alongside those of other Members of the House? Some four years ago, the Prime Minister, in his party conference speech, said that everyone would be able to see an NHS dentist within two years. Can the Minister say what percentage of adults in England and Wales are now registered with an NHS dentist?

Lord Warner: My Lords, I cannot give an exact figure, but I think that it is worth recalling that the Prime Minister's pledge has led to many of the current reforms which we will be debating further in the Health and Social Care (Community Health and Standards) Bill. However, our report suggests that about 90 per cent of the callers to NHS Direct are being advised of available sources of NHS dentistry within locally agreed standards and that about 16,000 people a month are taking up that advice and getting an NHS dentist.

Baroness Greengross: My Lords, can the Minister assure us that as the availability of dentists in the local NHS improves, older people and those who wear dentures will not be excluded? As people get older their jaws change and their need for dentists is just as great as when they were young. However, as they get older it is increasingly difficult to find someone who will look after them.

Lord Warner: My Lords, the changes which are being introduced will enable primary care trusts to organise and fund the dental services that their localities need. So if there is a very large number of elderly people, they will be able to put in place a suitable NHS dental service.

Motorsport

Lord Astor of Hever: My Lords, I beg leave to ask the Question standing in my name on the Order Paper. In doing so, I declare an interest as president of the Motorsport Industry Association.
	The Question was as follows:
	To ask Her Majesty's Government what support they plan to provide to secure world-class motorsport events in the United Kingdom, including the British Grand Prix and the World Rally in Wales.

Lord McIntosh of Haringey: My Lords, the Government are working with motorsport to secure major international events for the United Kingdom. The East Midlands Development Agency is working with Formula 1 management, Octagon and the British Racing Drivers' Club with a view to guaranteeing the long-term future of the British Grand Prix. The Welsh Assembly and Development Agency have successfully worked with the rallying sector to secure the Wales leg of the World Rally GP for at least the next three years.

Lord Astor of Hever: My Lords, I am grateful to the Minister for that relatively positive response. However, Canada has just lost its Grand Prix. Ours could go the same way, with disastrous consequences for our very successful motorsport industry. Can the Minister assure the House this afternoon that urgent action will be taken to secure the British Grand Prix?

Lord McIntosh of Haringey: My Lords, the noble Lord, Lord Astor, is asking me about action that will be taken, but action has been taken. As he will know, after his Unstarred Question last October, we set up a motorsport competitiveness panel which has brought together all of those interested in motorsport. The panel reported in July and its report was well received. The Department of Trade and Industry has provided funding for a motorsport development board, and of course the retention of the Grand Prix is one of its objectives.

Lord Corbett of Castle Vale: My Lords, will my noble friend confirm that as important as motorsport is to those who follow motorsport activities, the Government recognise that the research and development undertaken by the industry, particularly in engine technology, is applicable also to the mass motor car industry, and therefore helps to underpin that vital part of our manufacturing base?

Lord McIntosh of Haringey: Yes, my Lords, that is certainly true—it is, again, one of the conclusions from the motorsport competitiveness panel. The question of favourable tax treatment for research and development in the motorsport industry is one of the matters on which the competitiveness panel reported and about which the development board will be making recommendations to the Treasury.

Viscount Falkland: My Lords, can the noble Lord help the House by telling us to what extent this very successful automotive sport contributes to employment and the economy in this country?

Lord McIntosh of Haringey: My Lords, I think that every speaker in the dinner-hour debate last October gave the figures: about £3.5 billion and—although it is quite difficult to calculate—50,000 jobs. Although the figures have undoubtedly changed since then, the sport is clearly of great importance to our economy, which is why the Department of Trade and Industry has taken such positive and widely welcomed action.

Lord Moynihan: My Lords, just to be clear, are the Government prepared to step in directly with funding to safeguard the 850-acre Silverstone site?

Lord McIntosh of Haringey: My Lords, the Government have stepped in directly with funding. The Government put an extra £8 million into the A43 bypass specifically for that purpose, and of course the total funding for that is £28 million. If the noble Lord, Lord Moynihan, is asking about the infrastructure of Silverstone itself, then I would say that certainly there are issues about the quality of the pit stops and spectator and entertainment facilities there. However, the motorsport industry is not poor. I cannot say that it would be right for Sport England nationally to contribute to that.

Business

Lord Grocott: My Lords, I have two brief statements about business. First, with the leave of the House, after the three opening speeches in the debate on the Health and Social Care (Community Health and Standards) Bill, my noble friend Lady Ashton of Upholland will repeat a Statement on the children's Green Paper. Secondly, following that, with the leave of the House, my noble friend Lady Symons will repeat a Statement on Iraq and Israel/Palestine.
	May I say a very few words about the Health and Social Care (Community Health and Standards) Bill timings? As the House has already heard, there will be two important Statements today. I am always mindful of the advice which I receive from all quarters of the House on trying to finish at around the advisory time of 10 o'clock. I simply say that should the Back-Bench contributions to that Bill be restricted to about eight minutes, we would finish by 10 o'clock. If they were restricted to around 10 minutes, it would be around 11 o'clock.

Northern Ireland (Monitoring Commission etc.) Bill [HL]

Lord Williams of Mostyn: My Lords, I beg to introduce a Bill to make provision in connection with the establishment under international law of an independent commission with monitoring functions in relation to Northern Ireland, to make further provision about exclusion from ministerial office in Northern Ireland, to make provision about reduction of remuneration of Members of the Northern Ireland Assembly, to make provision about reduction of financial assistance under the Financial Assistance for Political Parties Act (Northern Ireland) 2000, to make provision about censure resolutions of the Northern Ireland Assembly and for connected purposes. I beg to move that this Bill be now read a first time.
	Moved, That the Bill be now read a first time.—(Lord Williams of Mostyn.)
	On Question, Bill read a first time, and ordered to be printed.

Civil Contingencies

Lord Brabazon of Tara: My Lords, I beg to move the Motion standing in my name on the Order Paper.
	Moved, That the Earl of Shrewsbury be appointed a member of the Joint Committee on the draft Civil Contingencies Bill in the place of the Lord Marlesford.—(Lord Brabazon of Tara.)

On Question, Motion agreed to.

Health and Social Care (Community Health and Standards) Bill

Lord Warner: My Lords, I beg to move that this Bill be now read a second time.
	We are today debating a Bill that represents another step along the path of adapting our National Health Service to the needs of the patients of today. For too long our NHS was neglected, but now it is getting the investment it needs and its hardworking staff are receiving the support they require. In 2002–03, NHS spending was about £55 billion—a 7.1 per cent increase in real terms over the previous year. That increased spending is going to be continued because the 2002 Budget provided for the largest-ever sustained increase in NHS funding.
	Patients are now beginning to see the results of this investment. More doctors and nurses are being recruited and trained. Compared with 2001, by 2008 there will be 15,000 more consultants and GPs, 35,000 more nurses, midwives and health visitors and 30,000 more therapists and scientists. New equipment and facilities are coming on stream—100 new hospitals by 2010; 7,000 extra beds by 2004; up to 3,000 GP premises improved or replaced; and 500 one-stop centres established by 2004. All this means improved access and quality of services for patients, with better clinical services and care and more choice. Waiting times are falling. Death rates from cancer and heart disease are decreasing. Neglected areas such as mental health are beginning to receive the attention they deserve. For elderly people, support at home and stroke and fall services are improving.
	But it is essential for patients that these large increases in investment must be accompanied by reforms which can help the NHS to use its resources more effectively and efficiently and which can improve services for patients. Our NHS must become even more patient-centred with more individualised care and more choice. Decision-making must be devolved from the centre to local areas so that the NHS can respond better to the specific needs of local communities. Pay arrangements must become more responsive to local circumstances so the NHS can recruit and retain the staff it needs. But all of this has to be achieved within a national framework that retains the core values of the NHS, especially the overriding principle of care being provided free at the point of need; and we need robust national standards that are rigorously monitored independently.
	The health and social care Bill will provide the reform needed to go with the additional investment. I should now like to outline how the main parts of the Bill will achieve this.
	Part 1 of the Bill provides for a new type of NHS organisation suitable for today's needs: the NHS foundation trust, to give it its full and proper name. The philosophy behind these trusts is consistent with the Government's approach to public service reform: high standards and clear accountability; devolution of responsibility; more flexibility for front-line workers and choice and diversity of provision for patients.
	In response to some of the concerns expressed, I should like to make five key points about this new type of trust. First, real improvements can be accomplished only if the NHS both increases capacity and increases the choice and diversity offered to patients. Capacity and choice are not alternatives—they are partners. The new trusts will increase the range of provision within the NHS. Working within NHS national standards they will enable local hospitals to be run to meet local needs.
	Secondly, NHS foundation trusts will treat patients entirely within the principles which underpin the NHS—that healthcare should be provided equally to those who need it, free at the point of need. They are not a back door to privatisation and they will be legally required to use their assets for the benefit of the NHS and to co-operate fully with other parts of the NHS.
	Thirdly, we recognise that the NHS should become a more personal health service where meeting the needs of individual patients is the first priority for clinicians, managers and commissioners alike. The principle of the NHS is defined around the needs of the patients, not the needs of the providers. Staff working in the new trusts will have more flexibility to meet the needs of local people because they will have more operational and financial freedoms.
	Fourthly, patients will have for the first time a way to direct and shape the organisations and really to influence how they are run. Together with local management flexibility, this will mean that local decisions can be taken which will be more responsive to the needs of local patients without the need to refer up the management chain for approval. For example, the University Hospital Birmingham NHS Trust will shortly open two new day-case wards. The process of getting approval from various tiers of management took 18 months—well over a year. In contrast, the actual building work will take only a few months. For an NHS foundation trust, the whole process could be much quicker. By the time 18 months were up, the wards would have been operational for several months and patients would have reaped the benefits.
	My last point is fairness and equity, which were meant to be enduring qualities of the NHS. But while the NHS has aimed to provide a universal service by removing the barrier of cost to the patient, it does not guarantee true equality of access to healthcare. The more personalised health service we want is related to the simple fact that, for all its benefits, the NHS has not as yet fully succeeded in providing equality of access to healthcare. By empowering individual NHS trusts to run services in response to local demand and need, it becomes possible for all to have high standards of access to services wherever they are. This is critical in tackling the health inequalities which permeate many of our most deprived areas.
	Part 1 of the Bill will, therefore, establish NHS foundation trusts as a new type of NHS organisation, based on a new corporate form—the public benefit corporation. This will provide local ownership and greater involvement of local communities in NHS trusts by allowing local people, patients, carers and staff to become members of their local NHS foundation trust.
	The new trusts will be different from existing NHS trusts in three important ways. First, they will have new freedom to decide locally how to meet their obligations. Secondly, they will be accountable to local people, who will become members and governors; and, thirdly, they will be authorised and monitored by an independent regulator.
	The primary purpose of the new trusts will be to provide NHS services to NHS patients and this will be set out in their terms of authorisation which will be issued by the independent regulator, who will be accountable to Parliament. NHS foundation trusts will be prevented selling off or mortgaging NHS property and resources needed to provide key NHS services.
	NHS foundation trusts will remain fully part of the NHS and like other NHS organisations, they will be required to improve quality of healthcare taking account of national standards for NHS services; they will deliver NHS services to NHS patients free at the point of use; they will treat patients according to need, not ability to pay; and they will be under a duty to work in co-operation with other health and social care partners. The myth being fostered by some that this change is all about competition, is just that, a myth.
	NHS foundation trust status will open the way to significant new freedoms as the new trusts will have the flexibility to implement new governance structures. These will be tailored to the individual circumstances of each trust so that it is able to respond much better to local needs. They will have the freedom to recruit and employ their own staff, with flexibility to offer new rewards and incentives that will assist recruitment and retention.
	The key difference between NHS foundation trusts and other types of trust is that although both will be required to meet national standards, the new trusts will be free to decide how they achieve them. This will enable them to achieve national standards in ways which best suit their particular local circumstances and requirements.
	Unlike NHS trusts now, which have access to public capital via the Department of Health and their strategic health authorities, NHS foundation trusts will access their capital requirements through loans which they will be expected to repay. All NHS foundation trust borrowing will be governed by a new prudential borrowing code which will limit the amount each trust can borrow and link it to their ability to service the resulting debt. So the trusts will have the opportunity to access capital both from the public and private sectors and use a wider range of financing options than are currently available to NHS trusts. This access to capital will allow the new trusts to implement capital schemes that will be locally and directly targeted to improving the patient experience.
	The public will have true social ownership of their local hospital, with accountability devolved from Whitehall to the local community. They will have a say in how that hospital is run. Local people will have the opportunity to become involved in the running of their NHS foundation trust, with rights to elect or become governors.
	NHS commissioners will be represented on NHS foundation trust boards of governors, giving primary care trusts a way to influence the organisation. NHS foundation trusts will be able to extend the benefits of greater freedom and flexibility to others in the local health community. This may include entering into partnerships with primary care trusts to develop specific services, such as promoting the development of local primary care services. Again, the accusation of increasing competition is untrue.
	Staff will have new opportunities to develop locally based services. They will be free to deliver the healthcare that is most appropriate to their local circumstances without Whitehall interference or bureaucracy. Staff will have rights to be represented and have their say in how the hospital is run, and to elect and stand for election to the board of governors.
	The Government have listened carefully to concerns about the change in direction, and have responded to them. We have ensured that all NHS trusts will have the opportunity to become NHS foundation trusts within a reasonable period of time to avoid anxieties about the NHS in England becoming a two-tier service. NHS foundation trusts will be subject to a cap on the income that they receive from private patients, so that NHS patients will always be their principal concern. NHS foundation trust applicants will be among the first to implement the new national pay arrangements for the NHS. The Secretary of State will not support applications from trusts that do not agree to implement Agenda for Change.
	After thorough scrutiny of the provisions on NHS foundation trusts in another place, the Government have put forward or accepted amendments to the Bill aimed at strengthening the constitutional and governance arrangements. I believe that we have now struck the right balance between ensuring accountability and genuine local representation, while leaving the new trusts free to tailor arrangements to their own local circumstances. For example, there are now requirements to ensure that the public membership of an NHS foundation trust is representative of the local community, that local authorities are represented on the board of governors, and that foundation trusts make explicit provision to deal with conflicts of interest for directors. The independence and accountability of the regulator have been strengthened to make him or her directly accountable to Parliament.
	Further amendments have clarified the position that patients from Scotland, Wales or Northern Ireland referred to NHS foundation trusts in England can continue to be treated as now. Particular concern was expressed in another place that patients resident in Wales might be excluded or disadvantaged by English NHS foundation trusts in, for example, border areas. I assure noble Lords that there is no need for further concern on that.
	The audit arrangements for NHS trusts were strengthened by introducing a new schedule on audit and giving the independent regulator the power to set standards, techniques and principles with which NHS foundation trust auditors must comply, in order to toughen the arrangements for financial probity and accountability.
	I hope that your Lordships agree that those changes substantially improve Part 1, but no doubt we will discuss the NHS foundation trust provisions in more detail at a later stage.
	Alongside our devolution of autonomy and resources to a local level, we need a stronger mechanism to ensure that national standards of care are met and maintained across the country. That mechanism has to drive out poor performance, improve further quality of care and continue to raise health and social care standards.
	The Government have agreed to take further steps to address Professor Sir Ian Kennedy's concern that there was potential for inconsistency and fragmentation when a number of bodies retained responsibility for inspection, and to reappraise the future role of the Audit Commission's work on clinical effectiveness and assessing the performance of the NHS.
	Under Part 2, functions currently performed by the Commission for Health Improvement, the National Care Standards Commission and the Audit Commission will be brought together in a single body, the Commission for Healthcare Audit and Inspection. The new CHAI will consolidate and build on the NHS review work currently done by the existing Commission for Health Improvement, the private healthcare regulation work carried out by the National Care Standards Commission, and the national healthcare value-for-money work of the Audit Commission. That will reduce the burden of bureaucracy on NHS organisations and remove any doubt whatever about who is the independent judge of performance and value for money in the NHS.
	The Bill will also apply the principle of independent inspections against national standards, or statutory guidance in the case of local authority social services, to the public and independent social care fields by creating the Commission for Social Care Inspection. CSCI will represent the rationalisation of the functions of the Social Services Inspectorate, the regulation of independent social care providers currently performed by the National Care Standards Commission, and certain social care audit functions of the Audit Commission.
	For the first time, there will be single inspectorates for both health and social care, which will be independent of government and reduce the burdens of inspection on those being inspected. That should generate increased confidence in both the public and the health and social care providers. CHAI and CSCI's independence will be made manifest in the duty that they will each have to lay an annual report directly before Parliament, rather than the Secretary of State.
	The independence of the organisations will be further ensured by the delegation of the appointments process for the chair and commissioners to the NHS Appointments Commission. Following recommendations from the commission, shadow appointments have already been made to both inspectorates to enable the transition work between the old and new organisations to be supervised independently.
	Both CHAI and CSCI will provide the public with performance ratings to make clear their assessment of individual NHS bodies and local councils. Both will develop their own respective criteria, taking into account the national standards set by the Secretary of State. There was some debate in the other place about whether the Secretary of State's approval of the criteria would compromise CHAI's independence, but it is the Secretary of State's responsibility to ensure that the criteria to be used by CHAI in its inspections are consistent with NHS national standards. It is the Secretary of State's role to set those national standards in his accountability to Parliament for the funding and running of the NHS.
	National standards will continue to be issued for social care, and CSCI will use those standards in determining the performance of all providers of social care through reviews and inspections. CSCI will be able to advise the Secretary of State about any changes that it thinks are needed to the standards.
	Our intention is to establish both new bodies from April 2004. That may require early commencement of certain provisions, and I will update the House about that in due course. Detailed work is currently in progress on the management structure of the new bodies, the transfer of staff and their accommodation. That is essential for a very large organisation such as CSCI, which will bring together the staff of the National Care Standards Commission and the SSI, with about 2,500 people working in the organisation. CHAI is expected to employ around 600 staff.
	To address particular concerns raised in the other place, we made amendments to the CHAI clauses on Report. First, we have made it explicit that CHAI will have a duty to conduct national reviews of particular types of healthcare as may be specified by the Secretary of State. Following a commitment made in Committee, we also made it quite clear that CHAI is to be concerned with all the factors related to the quality of healthcare when it exercises any of its functions in relation to the provision of healthcare, and in relation to reviews and investigations. Finally, we brought forward amendments to make it explicit that both inspectorates and the National Assembly for Wales are always required to produce a report or a summary of recommendations following individual inspections, and we introduced revised, slimmed-down and more straightforward clauses on the new national complaints procedures.
	I would like to say a few words about the new complaints procedures, which will replace the current arrangements for complaints about both health and social care. In future, CHAI and CSCI will operate an independent review stage of the complaints procedure when the health body or local authority concerned has been unable to resolve the complaint. That meets a key concern expressed by complainants about the perceived lack of independence in the review part of the current systems. It is also intended that regulations will allow for people unhappy about packages of services provided by health and social care bodies to make only one complaint about both, putting the onus on the organisations themselves to work together and instigate the necessary procedures to resolve all aspects of the complaint. That will make the process easier for complainants to use, and provide bodies dealing with complaints greater flexibility to work together to resolve them.
	The Bill gives the Assembly equivalent powers to the Secretary of State to define the complaints process in regulation. The Assembly already uses trained lay people to conduct third-stage independent reviews of complaints. That is felt best to reflect the needs of Welsh patients, and complements the process in England.
	I turn now to the implications of this part of the Bill for Wales. Although responsibility for healthcare provision is devolved to the National Assembly for Wales, CHAI will be established as an England and Wales body with some functions in Wales.
	The Bill acknowledges that the Assembly, working closely with existing standards-setting agencies, is best placed to determine the approach to implementing clinical standards for Wales, given the need to reflect the policy, priorities, structures and circumstances in Wales. The Bill provides for the Assembly to prepare and publish statements of standards in relation to the provisions of healthcare by and for Welsh NHS bodies.
	The Bill also provides for the Assembly, in the same way as CHAI, to conduct reviews of, and investigations into, the provision of healthcare by and for Welsh NHS bodies, including that provided by hospitals in England. To guard against duplication of reviews or inspections, the Bill places the Assembly and CHAI under a duty to co-operate. CSCI will not have jurisdiction in Wales and the Bill therefore places the functions of CSCI in England on the Assembly in respect of social care provided by local authorities in Wales.
	Part 3 extends the provisions made by the Road Traffic (NHS Charges) Act 1999 to enable the NHS to recover the £150 million or so it currently costs each year to treat injuries to patients to whom personal injury compensation has been paid. This implements a proposal by the Law Commission in 1996. The majority of respondents to the department's own consultation, which ended last November, supported the idea of such a scheme. The Bill is explicit that money received through this charge will be used for the benefit of patients receiving treatment at the hospitals concerned or the benefit of NHS ambulance services.
	At the Committee stage in another place, the Bill was amended so that there will be a right to apply for a waiver of the current requirement to settle a payment before lodging an appeal within the system, if exceptional financial hardship could result. At the Report stage, the Government fulfilled a commitment made in Commons Committee and clarified the definition of "injury". Diseases, such as asbestosis, are not included in the definition of injury, but psychological and physical injuries are, together with diseases occurring as a result of the injury in respect of which compensation has been paid.
	The Government are conscious that these powers are being taken at a time when the whole issue of employers liability compulsory insurance is being reviewed. We have made a commitment that, while we are taking this legislative opportunity to get the provisions on the statute book, we will not commence the provisions in the Bill until the final outcome of that review has been taken into account.
	It is intended that the new scheme will be operated by the Compensation Recovery Unit, in the same way as it currently operates the Road Traffic (NHS Charges) Act scheme. The scheme will operate in England, Wales and Scotland, the Scottish Parliament having approved its extension north of the Border.
	The scheme has been designed to meet the concerns of insurers and businesses. It will not apply to the costs of primary care treatment. As with the road traffic scheme, tariffs used to calculate payments due will be set at a fixed rate, irrespective of the actual costs of the treatment, so compensators will not be paying the full costs of the treatment received. There will be an overall cap on the total amount payable in NHS costs in respect of any one claim, so it is not an open-ended liability. Diseases are excluded from the scope of the scheme, unless they occur as a direct result of the injury, specifically in response to concerns voiced by the insurance industry about the added complexities of such cases. Contributory negligence will be taken into account in cases where there is a court finding or court-endorsed agreement between the parties involved. This is a move away from the current road traffic scheme, but was seen by the Government to be a more equitable way forward in this case.
	The BMA and the BDA welcome the Government's medical and dental provisions in Part 4. In a recent ballot, nearly 80 per cent of voting general practitioners accepted the new general medical services contract negotiated for them by the General Practitioners Committee of the BMA and the NHS Confederation, which Part 4 implements.
	There is little doubt that the general medical and dental service contractual arrangements are in need of modernisation. They have been tinkered with for many years, but the time has come for more fundamental changes that meet today's needs both for patients and practitioners. This Bill addresses four key problem areas.
	Primary care organisations need to be able to contract with practices, commission more services where necessary or even provide services themselves. People wishing to access NHS dentistry cannot always find an NHS dentist. We need more NHS dentists in particular places and NHS dentistry needs to be a more attractive proposition. General dental practitioners need a better method of remuneration. GPs want to be able to control their workload in order to provide a better service to patients and for their job to continue to attract new recruits.
	The Bill will provide a better deal for patients seeking NHS medical and dental services and for professionals choosing to provide them. The Bill gives primary care organisations—primary care trusts in England and local health boards in Wales—an overarching responsibility to secure or provide primary dental and medical services. They will be able to do so through contracting with practices or by commissioning or providing services themselves. For dentistry, £1.2 billion, currently held centrally, will be directly allocated to PCTs to secure NHS dental services.
	For the first time, primary care organisations will contract with individual practices, not individual practitioners, under the general medical services contract and general dental services contract. It is not only GPs and general dental practitioners who make NHS primary care tick—other professionals, such as dental hygienists and practice nurses, are key to providing high standards of patient care.
	All practices will be required to provide a specified level of services to their patients under the general medical and general dental services contracts, but the provision of certain services, such as out-of-hours medical cover, will be open for negotiation as to whether it forms part of that contract. This means that professionals will be able to tailor their workload to fit their individual circumstances. The primary care organisations will have the power in this Bill to commission or provide services themselves to plug the gaps where necessary.
	The Bill overhauls dental remuneration and patient charges. Dentists tell us that the current remuneration system, whereby they are paid for each service and treatment they provide, is rather like a treadmill. Patients tell us that it is hard to understand how the charges are calculated. Others tell us that the arrangements lead to a focus only on remedial and not preventive work. To improve this, the Bill provides for remuneration to be part of the contracts negotiated between primary care organisations and particular practices, adhering to national guidelines in regulations. Practices will be paid for their continuing responsibility for their patients as well as for the particular treatment provided.
	Part 5 of the Bill reforms the welfare food scheme to provide for pregnant women, mothers and young children, including children in nursery or day care, to have access to a wider range of "health" foods under the scheme. This reflects the conclusions of the scientific review undertaken by the Committee on the Medical Aspects of Food and Nutrition Policy. Milk will continue to be an important part of the scheme, but the intention is that beneficiaries will have access to a wider range of health foods such as fruit and vegetables to provide a better balanced diet.
	Part 5 also enables the Secretary of State to delegate to a special health authority all or part of his appointment-making function in respect of bodies with functions concerned with health, social care or the regulation of professions associated with health or social care. This will allow for greater independence and transparency. It is our intention that this special health authority would be the NHS Appointments Commission.
	Part 5 also modifies the legislation that provides for the protection of vulnerable adults and the protection of vulnerable children lists so that persons holding a permanent NHS contract will not require another check against those lists should they undertake agency work.
	This is an important Bill which continues essential reform to match this Government's unprecedented financial investment in the NHS. It will provide a new, more autonomous, local delivery system—the NHS foundation trust—alongside a more coherent and independent inspection system and new NHS national standards. It provides for new local contracting for primary medical and dental services which has been welcomed by the BMA and the BDA and which will benefit patients.
	There has been a lot of debate about NHS foundation trusts, but their critics should recognise that they preserve long-cherished fundamental NHS values while giving local communities a greater chance of getting a health service more tailored to their needs. This is a Bill that will produce real benefits for patients. I commend the Bill to the House.
	Moved, That the Bill be now read a second time.—(Lord Warner.)

Earl Howe: My Lords, the House will be grateful to the noble Lord, Lord Warner, for his very helpful and clear explanation of this important Bill. There is much in it to occupy us over the weeks ahead, but I am sure that he, like me, is greatly looking forward to the debate ahead of us today. It is especially heartening to see the distinguished list of noble Lords who have put their names down to speak, not least—if I may mention one individually—the noble Lord, Lord Hunt of Kings Heath. He has brought his wisdom and experience to so many health Bills over the past few years that I have lost count.
	In many ways this is a landmark of a Bill. When I first became Opposition health spokesman six years ago, times were very different. We had a health secretary, and indeed a government, who believed passionately in the power of centralised political control. For them the success of the National Health Service required, above all, two things: taxpayers' money and detailed, prescriptive target setting. Any form of competition in the NHS, whether between hospital trusts or between different GP practices, was regarded as having no place at all in publicly funded healthcare. Privately funded healthcare was thought to be such anathema that it was practically banished off the political map.
	There followed, as we know, a period of almost obsessive adherence to that centralist mentality: the relentless stream of targets, instructions and guidance issued from Richmond House; the constant harrying and bludgeoning of managers and doctors; the blank looks that appeared on Ministers' faces at the mere utterance of the phrase "patient choice"; and finally, of course, the abolition of those terrible nuisances, those regular thorns in the flesh of Ministers, community health councils. That was the climate of Labour's first term.
	So when, shortly after the last election, Mr Milburn started talking about patient choice, of devolving money and power downwards in the NHS and of creating one inspectorate for the NHS and private hospitals—something for which we had been arguing for years—it seemed truly like a Damascene conversion. It was a change of heart that we on this side of the House could only applaud. Talk to anyone senior in the health service, or come to that anyone more junior, and they will tell you that central direction of the kind that we have witnessed over the past few years is a recipe for bureaucracy, stifled morale, thwarted initiative and ultimately ineffectiveness. In the commercial world there is no organisation of the size of the NHS, or even half its size, that can be micro-managed, Soviet-style, from one office. It is an impossible aspiration, because, as the Government have found, any attempt to achieve it proves ultimately to be counter-productive.
	The concept of foundation trusts represents one part of the new direction for the health service. It is an idea that has been presented to us in terms with which no sensible person could disagree. Removing the power of direction from Whitehall; devolving resources; giving front-line professionals the freedom to take strategic decisions and to set their own priorities for patient care; making the service more responsive to patients and the needs of local people; giving hospitals control over their own assets; allowing them to borrow from the private sector; giving employees greater flexibility; are all positive ideas that, for us at least, struck exactly the right chord when the former Secretary of State first spoke of them in April last year.
	We then waited for the publication of this Bill, and as we waited, we were conscious of other and more reactionary forces at work; not least the combined manoeuvrings of the Treasury and the Chancellor of the Exchequer. We knew almost without being told that with foundation trusts the rhetoric might be one thing but the reality could turn out to be quite another. The proof of the Government's lofty aspirations lies in the Bill. We need to look at it critically.
	There are perhaps four principal claims for foundation trusts that the Minister has just articulated: that they will enjoy real and substantive freedoms; that they will be genuinely accountable to their local populations; that their governance structure will be soundly based; and that they will deliver real benefits to patients.
	Let us first look at the freedoms. Would we be right in supposing that the influence of the Secretary of State will suddenly be removed from foundation trusts? No, we would not. It is a cardinal feature of the Government's plans that foundation trusts will be made to undergo annual performance reviews in accordance with the star rating system. The star rating system depends on nine key targets and 28 performance indicators; all of which are determined by the Secretary of State. Fall foul of those and you will find the regulator homing in on you; for in every area where the Secretary of State has relinquished his control, the regulator will step into his shoes with powers that are every bit as extensive. The services that the trust provides, the asset sales that it wants to make, the private income that it wants to earn; all those and much more the regulator has to approve; and as Clause 3 tells us, he has to do so in a way that is consistent with the Secretary of State's performance of his duties. If that is someone's idea of devolved decision-making, then it certainly is not mine.
	We should also disabuse ourselves of the idea that foundation trusts will have the freedom to configure their services as they see fit. The reality is, as Mr Milburn admitted in another place, that the PCT, as the commissioning body, will hold the power. The local PCT, in Mr Milburn's words,
	"will decide where the money goes".—[Official Report, Commons, 7/5/03; col. 712).
	That is of course perfectly correct because under the Government's plans for financial flows, patients and GPs will increasingly call the tune about the services that they want. That means that foundation trusts in practice will have very little choice as to how to configure themselves.
	But if that is so, one may very well ask what on earth is the point of the elaborate and costly governance structures with which foundation trusts will be saddled? Ministers have sat down at a desk and convinced themselves that what foundation trusts need is local democratic accountability. So they have devised a structure, based on membership and elections, that purports to give local populations the power over the services that their local hospital provides, but it will do no such thing. The expectations created by that system of governance are bogus and, as I shall argue in Committee, are very likely to lead to frustration and disenchantment on the part of those who participate.
	The Government have not consulted on the governance model; nobody out there has asked for it; yet it is going to be foisted on all foundation trusts, including the specialised national hospitals, without any evidence at all that patients and the public will thereby be genuinely empowered and still less evidence that it will lead to the one thing that is needed which is good governance. On the contrary, I believe that it will deliver little more than a talking shop for different factional interests and, what is more, factional interests who are legally accountable to no one.
	These are half-baked, muddled ideas that carry huge risks. In advance of the Committee stage, I say to the Minister that they are not acceptable to this side of the House. However, if there is one feature of the Government's proposals that for me renders them not simply unacceptable, but actually wrong in principle, it is their effect on the rest of the health service. Foundation trusts will enjoy the advantage of being able to borrow from the private sector in order to enhance and expand their services. But we know from the Chancellor that every pound of foundation trust borrowing is a pound less for the rest of the NHS. There is no extra pot of commercial money for foundation trusts. Their borrowing capacity will be part of a zero-sum game within the health service as a whole.
	The Government profess to believe in levelling up the standards of NHS care. I frankly cannot see how that is possible when the very trusts which need capital most—those which are struggling zero, one and two star trusts—will be deprived of it while foundation trusts get it because they are considered by Ministers to have earned it as their privilege. As night follows day, financial growth in foundation trusts will mean cuts in the budgets of other hospitals to the detriment of patients. This is a culture that has been described as "dog eat dog". I say unequivocally to the Minister that it has no place in our National Health Service.
	I have deliberately chosen to concentrate my speech on perhaps the most politically contentious part of the Bill. Less prominent in the public debate, but no less important, are the Bill's proposals for the new Commission for Healthcare Audit and Inspection and its sister body, the Commission for Social Care Inspection. My noble friend Lady Noakes will be devoting the bulk of her speech to the numerous concerns that we have in that quarter. I will only foreshadow what she is going to say by making one point. Public confidence in the existing Audit Commission, of which I believe there to be a great deal, is underpinned by its very obvious independence from government. If we wish to create an equal measure of public confidence in new CHAI and CSCI, then I firmly believe that these bodies must be allowed to operate as independently of politicians as it is possible to engineer. The Bill as it stands does not remotely provide for that. We will reflect that concern with considerable emphasis in Committee.
	With any Bill there will be areas of agreement as well as disagreement between the political parties. My overriding feeling about this Bill is one of acute disappointment; disappointment that its most significant proposals—the ones that in the wake of all the Government's rhetoric we would like to have supported enthusiastically—have in the event been botched. The criticisms that we will be voicing at later stages will therefore be more extensive than I would have wished; but as ever they will be as constructive as we can make them. I look forward to those debates as the avenue to creating a better and more coherent Bill.

Lord Clement-Jones: My Lords, I, too, thank the Minister for his lucid exposition and say how much I look forward to the debate today.
	The Bill, which I think is the fifth or sixth health reform Bill that has been put forward by this Government, is a characteristic piece of work. The Government always argue that the next reform in the health service will do the trick, but then a few months later another set of reforms is announced, often contradictory to the previous ones, and followed by a new—guess what?—health service reform Bill.
	The depressing thing about having been an opposition spokesman for more than a few years is seeing just how little faith one can place on government's statements of confidence in a particular set of reforms at any particular time. The noble Earl, Lord Howe, very ably described the lurches in policy which have taken place already under this Government after only six years. This Government do not just have second thoughts; they have third and fourth thoughts as well.
	Sir Andrew Foster, the former chief executive of the Audit Commission, in a valedictory interview with the Financial Times in February, I believe had it right. He said:
	"I worry about the sheer mass of structural change there has been . . . and whether that will really bring the result that is needed . . .
	But one of my experiences of 30 years in public service is that setting up these new institutions and getting them working well always takes two to three years, and longer than people hope.
	People become preoccupied with establishing them, and politicians very often then become impatient, and before you know it there are calls for further change. There is a danger of people getting slightly punch drunk about the amount of change".
	I think that that is an understatement.
	The fact is, however, that this Bill is an orphan. It limped out of the House of Commons. At Third Reading the Government secured their lowest majority—of 35—during their term of office. The Government had to rely on the votes of their Scottish and Welsh MPs to get the Bill through. Some of the biggest names on the Government Benches opposed it. I make a small prediction that this Bill will have an even harder time in this House.
	Let us start with foundation hospitals. Adjustments have undoubtedly been made as the Bill progressed through the other place. However, just because we now might have 63 foundation hospitals rather than 25 does not make them a better idea. Our view on these Benches is that the basis for selection is poor; the star ratings are arbitrary; and there is evidence that the assessment process can be manipulated.
	Then we turn to the impact on the wider NHS of foundation trusts. It is doubtful whether all NHS trusts can achieve foundation status within four to five years. In any event, in the interim, foundation trusts are likely to affect the viability of other hospitals in their areas. They will be able to vary employment terms and conditions and to draw staff away from non-foundation hospitals. Foundation trusts will compete with other trusts for resources. That will lead to even greater inequalities between hospitals. The Health Select Committee's comprehensive and probing report rightly questioned whether this kind of competition between hospitals would benefit patients.
	There is a great deal of uncertainty about the duty to consult before the initial 63 foundation hospitals are established. Being the first 63, will they escape any kind of consultation requirement? Moves to form foundation trusts are afoot, yet no consultation has actually taken place. Furthermore, no consultation with oversight and scrutiny committees appears to have taken place. On top of that, plans to merge, change or close hospitals which plan to become foundation trusts can be changed up to the very last moment without public consultation.
	There is the issue of patient and public consultation. Foundation hospitals will have no duty to establish patients forums or to introduce PALS. There is huge disappointment that patients forums are not provided for in the Bill. Simply having a few non-executive directors on boards is no substitute for a properly constituted patients forum.
	Critics of foundation trusts will not be mollified by requirements that hospitals will have to prove that all sections of the community are represented. Far from it; the constitution of what are described under the Bill as "public benefit corporations" promises to be a nightmare of bureaucracy. Each trust will have two tiers, a board of governors and a board of directors. A membership—the so-called public constituency—will elect the majority of governors. Non-executive directors must be members. The membership and governance system in each foundation hospital will be locally determined within an overall template. It will be very cumbersome and complex. The membership, for instance, could be 5,000 strong, but it is to be arbitrarily determined. That itself will cause divisions in local communities.
	The governance will be massively expensive to administer. This is not cutting red tape but creating more. All this will not lead to better performance or democratic accountability. Public benefit corporations could quite adequately be run as companies limited by guarantee, as many of our major charities are, with trustee directors nominated to represent the communities or stakeholders that they serve.
	As a final consequence, the governance provisions could mean that competent non-executive directors, having steered their trust into foundation membership, will actually have to stand down.
	What does the financial future hold for foundation hospitals? In fact the Treasury regards them with distaste. Having gone through the hoops to become foundation hospitals, the Treasury will still rule the roost. Ultimately, the NHS budget for acute hospitals will remain unchanged and foundation trusts will be playing a zero-sum game with NHS resources in competition with other parts of the NHS.
	Then we come to the extent to which foundation trusts can compete with the independent healthcare sector and the provisions of Clause 15. I am all in favour of strong finances for NHS trusts. But if we genuinely believe in achieving capacity for the NHS and in a mixed economy which allows the private sector to compete to deliver services to the NHS, it is important firmly to restrict the provision of private healthcare by NHS hospitals.
	The job of NHS acute hospitals is to deliver for the NHS. The short-term attractions of additional income could skew the system, deter private sector provision of NHS services and fail to make the best use of the capacity of the NHS. There should therefore be explicit limits under Clause 15. I was pleased by what the Minister said today but I believe that that should be enshrined in the primary legislation.
	At the end of the day, rather than going down the foundation hospital route, the essence must be to free the providers of healthcare from bureaucracy and central control and to increase democratic accountability where it really matters—with the commissioners of NHS healthcare. They are the ones who hold the budgets. It would be much better to make the commissioning system democratic. On these Benches, we say that the best way to achieve that is via local government. Ultimately, it is very likely that, despite all the rhetoric, foundation hospitals will in fact be no freer than they were before this legislation.
	I turn briefly to CHAI and CSCI, as the Minister called it. This is the classic third or fourth thought. But we welcome the very late conversion of the department to the regulation of the private sector by a single body along with NHS bodies. We welcome the Government's conversion to a new and broader role for CHAI, which we urged on the then government Ministers some three or four years ago. Last year, Mr Milburn gave an undertaking that the new commissions would be every bit as independent as the Audit Commission.
	However, there is a distinct flavour of a lack of independence under the Bill. CHAI is charged to have regard to government policy. There is also the crucial issue, referred to by the Minister, of who sets the standards to be inspected—CHAI or the Secretary of State? The criteria for star ratings should be set objectively and designed to raise clinical quality and improve patient experience. It should not be the Secretary of State who determines the new standards and the criteria for star ratings. Where is the CHAI/CSCI duty to lay a report before Parliament enshrined in the Bill?
	However, we take some confidence from the nature of the appointments and the fact that the NHS appointments commission will appoint members of both regulatory bodies. But why should commissioners of healthcare, such as PCTs, not also be covered within the scope of CHAI? After all, CHAI will be inspecting strategic health authorities as part of its duties. Will private dentistry be covered by CHAI, as per the government commitment on this subject?
	Generally, the powers of CHAI could be more defined. There should be an explicit duty to ensure implementation of NICE guidance and the national service frameworks to ensure that, for example, mental health services are provided nation-wide or that particular treatment or medical technologies are introduced.
	Furthermore, the General Medical Council is concerned about the issue of patient confidentiality and the possible use of personal confidential information by CHAI and the other regulators in carrying out their duties. They should use aggregated or anonymised data where possible and not breach confidential information contained in patient records.
	There are also issues relating to the division of responsibilities between CHAI and CSCI. Although generally Clause 29 is sensible in setting out that division, there is concern that treatment of some long-term conditions, such as that provided by brain injury units, and time-limited treatments, such as in relation to drugs and alcohol, will come under CSCI and not CHAI. It is important that each regulator has the appropriate expertise in the field which it regulates. In the course of his reply, perhaps the Minister will comment on that.
	Again, what are the precise lines of demarcation between CHAI and the Audit Commission? What is the intention behind Clause 57? Is it purely a matter of sub-contracting? There is the issue of national standards. They should be determined independently and not by the Secretary of State. Are the national service frameworks and NICE guidelines not already meant to constitute a set of national standards, or do we see yet another confusing change of direction by the Government?
	A number of areas of the Bill deserve discussion but time is moving on and I shall not go through the comments that we have on these Benches regarding complaints, the welfare food scheme and dentistry, in particular. But we shall put forward amendments in Committee.
	The Minister may believe that I have engaged in harsh criticism of the Bill. However, he can be reassured that, whatever the criticisms raised today from these Benches, they will be a picnic compared with Bournemouth in three weeks' time.
	It is unfortunate that great swathes of the Bill received no scrutiny at all in the Commons. Foundation hospitals are, of course, at its core but it has many other flaws as well. On these Benches, our aim is to force the Government to scrap completely this half-baked scheme of reform. Foundation hospitals were nowhere in the Government's manifesto at the last election and there has been no consultation on these proposals, as the noble Earl, Lord Howe, pointed out. The Secretary of State who dreamt up these proposals is not even in office. On these Benches, we greatly look forward to the Committee stage and to improving the Bill.

Children

Baroness Ashton of Upholland: My Lords, with the leave of the House, I shall now repeat a Statement made in another place by my right honourable friend the Secretary of State for Education and Skills. The Statement is as follows:
	"With your permission, Mr Speaker, I wish to present to the House this afternoon the Children's Green Paper, Every Child Matters. It is published alongside a detailed response to the Victoria Climbie inquiry report and a report by the Social Exclusion Unit into the educational achievement of children in care.
	"I want to begin by thanking my colleague, the Chief Secretary to the Treasury, and the Minister for Children and officials across Whitehall for the excellent work they have done in preparing the Green Paper. The Chief Secretary's personal commitment to the central importance of inter-departmental partnership working was crucial to achieve these proposals.
	"The Green Paper sets out reforms covering children and young people from birth to 19 living in England. Our goals are both to protect children and young people and to ensure that each child has the opportunity to fulfil his potential.
	"The death of Victoria Climbie exposed shameful failings in our ability to protect our most vulnerable children. On 12 occasions over 10 months, chances to save Victoria's life were not taken. Failings occurred across all services at all levels.
	"While no society can entirely eliminate the risk of children being damaged or exploited, our society has a duty to give priority to the protection of children and to tackle the tragic and avoidable failures that occurred in Victoria Climbie's case.
	"From past inquires into the deaths of Maria Colwell and Jasmine Beckford to recent cases, such as Lauren Wright and Ainlee Walker, the list of problems is familiar: unwillingness of some of the most senior people in agencies to accept their own accountability; poor co-ordination across agencies; insufficient sharing of information; and frontline workers who are overloaded and under supervised.
	"But these issues do not just afflict the 80 children who die each year from abuse. Weak accountability, poor integration and workforce pressures are all critical barriers to improving the lives of all our children. Too many children fall through the net only to reach a crisis that could be avoided. Too many children are passed around the system only to end up in care, in prison or worse.
	"Lord Laming makes clear that nothing less than fundamental reform will address these issues. No single change alone is enough. National standards, inspection, information sharing, training, and national and local structures all need to change if we are to achieve real changes in culture and practice. Radical reform is needed to organise our services around the needs and priorities of children.
	"I believe that the proposals which I am publishing today do meet the reform challenges identified by Lord Laming. Our task is properly to put them into effect.
	"The central theme of the Green Paper is that every service, every professional, every community, every family must take responsibility for the protection of children. Child protection must not be ghettoised and seen to be the responsibility of only one profession, social work. It must be the responsibility of everyone and so must be at the heart of all services.
	"Equally, it is vitally important for every organisation to have a positive vision of young people and high expectations for all of them, whoever they are, and wherever they live.
	"Every government department is already trying to tackle the reasons why children are held back, whether through poverty, poor schooling, violence in communities, lack of activities for young people or lack of access to health care, and I confirm that we will continue this drive, so shifting the emphasis on to prevention.
	"The Green Paper sets out comprehensive reforms to ensure that this approach is carried through. I believe that they extend the principles of our Sure Start programme, which have been widely welcomed, to all areas of childcare in this country.
	"There are four main areas of reform. The first is supporting families and carers. We all know the critical influence parents have on children's lives, yet in the past we have paid insufficient attention to the crucial role of families in improving children's lives. By bringing children's policy and family policy together within my department we will start to look at how we can support families more effectively.
	"The Green Paper consults on a long-term vision to support families through universal services providing information, advice and support, and through more targeted services.
	"As a first step, we have created a parenting fund to build capacity in the voluntary and community sector, and we will bring forward proposals to roll out nationally the current level of home visiting support provided by HomeStart.
	"The second area is early intervention. For the majority of children, the combination of support from their families and schools is enough to enable them to thrive. But, for a significant minority, more help is needed.
	"Yet for hundreds of thousands of young people, their potential is wasted because help comes too little too late. A child may be known to several services, but nobody shares the warning signs and no action is taken.
	"Children can be passed from agency to agency. They can be assessed over and over again. They may be known to lots of professionals, but all are based in different places, working to different bosses and budgets, and with no one in overall charge.
	"We need to build a system that ensures children receive help at the first onset of problems. Early intervention requires new forms of integration on the ground: information sharing systems; a common assessment framework; a lead professional co-ordinating packages of support; professionals working together in multi-disciplinary teams, based in and around the places where children and families spend their time—schools, children's centres and GP surgeries.
	"The Green Paper brings forward proposals to develop better early intervention on all these fronts, including legislating to ensure professionals share information more effectively.
	"We will always have to strike a balance between individuals' right to privacy, and the need to share information to protect children. I believe that that balance needs to be shifted towards sharing information better so that problems can be identified more rapidly and effectively.
	"The third area is accountability and integration. Integration in practice is possible only if we integrate our institutions, structures and professions. This is the real focus of the Green Paper—addressing the underlying barriers to improving our services. Lasting change requires new institutional arrangements not initiatives.
	"Let me set out the key changes aimed at delivering clear accountability and integration around the needs of children.
	"First, we will legislate to create the post of a director of children's services, accountable for local authority education and children's social services. As Lord Laming made clear, we have to have a clearly named person in overall charge of children's wellbeing and protection.
	"Secondly, to ensure clear accountability politically, we will create a lead council member for children.
	"Thirdly, in the long term our aim is to integrate key services for children and young people under the director of children's services, as part of children's trusts. These will bring together the local education authority, children's social services, health services and potentially others, including Connexions and youth offending teams, into a single organisational structure. We all know the difficulties of joining up across boundaries. Our approach is to seek to break down these boundaries altogether and organise the services around children.
	"Fourthly, there will always be some organisations outside the new children's trust, such as the police. We will therefore require the creation of local safeguarding children boards to bring together all agencies to improve child protection. We will also legislate to place a duty on all services to safeguard children—we have to ensure our children's safety is a priority across all services.
	"Fifthly, we will support these local changes through national change, including the development of an integrated inspection framework led by Ofsted to ensure all services are judged on how they work together.
	"Finally, where national standards are not met, and our inspection system indicates failure, we must be tough on delivering changes. We will therefore create within the department a strong focus on sharing effective practice and intervening in areas that are falling below national standards.
	"In addition, I can announce that the Government will legislate at the earliest opportunity to create a children's commissioner to act as an independent champion for children. The commissioner will develop effective ways to draw on children's views, locally and nationally, and to make sure that they are fed into policy-making.
	"The fourth area is workforce reform. The workforce reforms set out in the Green Paper have two aims. The first is to tackle the recruitment and retention problems, particularly acute in social work, by making working with children an attractive, high-status career.
	"The second is to improve the skills and team-working of the workforce—we need to ensure our professionals work together with shared goals, values, language and priorities.
	"We intend to bring forward a package of changes to develop: new career pathways to enable staff to acquire new specialist skills, enabling sideways career moves, or enabling them to remain in frontline services; a leadership programme to support the first generation of children's directors and their senior staff; a common core of training for those who work with children; reduced bureaucracy and workload pressures; more flexible and attractive training routes into work with children, including expanding work-based training routes for graduates.
	"To deliver this, we will work with employers and staff to create a sector skills council for children and young people.
	"I believe the reform programme we are delivering will mark a turning point in child protection. The legislation and institutional change we are proposing will genuinely put children first.
	"Reform will take time and will require commitment across government. Perhaps most critically, it will take a process of cultural change—to build a society where protection is embedded across all communities, professionals and services, locally and nationally. Our aim is to build a society where truly every child matters, and in that spirit I commend these proposals to the House".
	My Lords, that concludes the Statement.

Baroness Blatch: My Lords, I thank the Minister very much for this Statement. It is welcome though somewhat overdue. One thinks with great sadness of the loss of Victoria Climbie, Lauren Wright, Maria Colwell, Jasmine Beckford and many others, and of how they were failed by the established system and those who should have provided the greatest protection and security of all—their own parents, guardians and carers.
	Once again we have a Statement that has been well trailed on TV and radio and outside this House, and, of course, our House is last in line to receive the information. I ask the Minister why the Statement has been delayed. We understand from a leaked Whitehall document that the Statement was ready in July but was delayed to spare the embarrassment of the then Minister, Mrs Hodge. We were told at that time that the Prime Minister was undertaking personally the presentation of a Statement to Parliament but, understandably, he could not at that time due to time pressures on the diary.
	The delay is serious. Every week children across the country are failed by the system; therefore, reform of the system is urgent. So why the delay?
	I have had very little time to absorb the detail of this response from the Government; therefore, an early debate would be welcome to explore the detail in more depth. Are there any plans to give parliamentary time for such a debate?
	There is no mention in the Statement of the vexed and current issue of trafficking in young people, many of whom end up as victims of abuse. Does the Government's response cover that issue? If not, will it be included as a distinct part of what happens to children in this country?
	The call for more working in multi-disciplinary teams, which was mentioned in the Statement and has been proffered as part of the solution, fills me with dismay, because there is now a plethora of multi-disciplinary arrangements at local—and, indeed, regional—level. It is important that we at least know what is different in this case.
	On a practical level, the role of schools will be very important. Has there been an assessment of the additional burdens imposed by these proposals, such as their financial impact and burden on teachers' time? Things are far from easy for schools at the moment and I believe that additional calls on their time or resources will prove to be the straw that breaks the camel's back—to coin a phrase.
	What protection is there for teachers who are in the position of having to make accusations against parents? I know that many teachers feel vulnerable and it is important for the Government to give some reassurance that, when a child is at risk, there is some protection for the teacher involved. Making accusations is extremely serious and it is important that plenty of advice and support is available.
	It is also worth mentioning that all confidential records kept by schools must be made accessible to all parents, which increases the vulnerability of the staff in schools who have to record key information.
	Another issue that was not included in the Statement and may not be a part of the response is the call for more research into the distress caused by wrongly accusing parents of abusing their children. Not infrequently, such parents are, if anything, being over-protective. There is also the vexed issue of Munchausen syndrome by proxy, when parents call out for help only to be wrongly accused of being abusive parents. Such instances put social services in a very difficult position, but I have heard some blood-curdling stories of parents being almost destroyed by the system when, at the end of the day, they are only being over-protective—if it is possible to be an over-protective parent. I make no judgments, but there is a case for urgent research.
	How many of the recommendations of the Laming report have already been implemented? How many recommendations is the report intending to implement and what is the timescale involved? I am sure that the Minister will agree that many children who are seriously at risk are not in school at all, either because they are not sent to school by the parent, carer or guardian, or because they are not of statutory school age.
	The use of volunteers is also pertinent. There must be very clear guidance about how they are used. For example, it will not be possible for volunteers to have open access to people's homes. Therefore, although the voluntary sector is important, there will need to be clear guidelines as to how that sector is used when such dangerous situations are afoot.
	Although they are not solely responsible, because we recognise that the main responsibility rests with parents and guardians, social services are nevertheless on the front line of this work, which is particularly difficult work for them. The annual report of the Chief Inspector of Social Services claims that vacancy rates are running at 11 per cent when they should be only 5 per cent or less. It is also known that more social workers are needed to provide the continuity and stability that are crucial in these cases. I understand that many urban local authorities, especially in London, are using very high numbers of agency workers, which is both expensive and creates instability. What is being done to deal with that state of affairs?
	Much will be expected of local government. However, there is a dichotomy: the Government make financial demands on local government concerning educational expenditure or expenditure on other services, but in many local authorities, there is only one place from which the money can come, which increases the pressure on social services. It is important that there will be some respite for local authorities in terms of how they will meet the additional costs implied by this report.
	The welcome centrepiece of the Statement is the establishment of a children's commissioner. However, we must heed the words of the Children's Commissioner for Wales today, when he said that the appointment of the commissioner will not in itself make things better. It is important that the change is effected at local level. Will the Minister assure us that the commissioner will be entirely independent in the way he sets about his work?
	I do not doubt the Government's intentions in this matter. However, I remain nervous about what appears to be the most complicated web of bodies, lines of accountability and bureaucracy. Also, there is no mention of costs in the Statement whatever, which is a critical aspect.
	The very real test will be whether children in this country, especially vulnerable children, will be more secure and better protected as a result of these changes. We can only wait and see. Meanwhile, we wish the proposals well.

Baroness Walmsley: My Lords, I join the noble Baroness, Lady Blatch, in thanking the Minister for repeating the Statement in this House. We on these Benches warmly welcome many of the measures contained in it. I also remind the House of my unremunerated connection with the NSPCC.
	We, too, regret the delay in the publication of this paper until the end of the Prime Minister's summer holiday, and I look forward to hearing the Minister's response to the question asked about that matter by the noble Baroness, Lady Blatch. However, while we all mourn the children who died, we must move forward.
	I have some comments and questions about the generalities at the beginning of this Statement. First, we welcome the commitment to address the problems of weak accountability, poor integration and workforce pressures. However, one solution is more resources and training. Will there be more money for that work?
	Secondly, we welcome the commitment to everybody being accountable. The obligation to take responsibility must, of course, be backed by workable management structures and lines of reporting as well as good training. How will that be delivered? Will the performance of the Minister for Children also be assessed, and, if so, by which Select Committee?
	Thirdly, we welcome the commitment to shift the emphasis on to prevention. However, one of the main problems in recent years has been disintegration of youth services. How do the Government plan to address that? Will there be more money for an accelerated spread of the Sure Start programme to reach all children in poverty, even if they live in an otherwise affluent area?
	The first of the Minister's four detailed areas relates to supporting families and carers. We very much welcome the commitment to creating a parenting fund, support for parents and parenting training, which is very important. There have been nowhere near enough resources for that in the past. Will the Minister explain in more detail how that will be administered?
	We very much welcome the commitment to early intervention and the integration of the work of professionals. However, will the multi-disciplinary teams be truly multi-disciplinary, involving not only education and health, but social services, including strong links with the criminal justice system?
	On the problem of privacy and striking the balance, how can we be sure that privacy will be dealt with sensitively and that children will not be deterred from speaking out, knowing that information will be shared?
	On accountability and integration, we welcome the creation of the post of director of children's services, but how will that person interact at the first stage of the reform with the local delivery of children's health services? The Statement mentions only education and social services. We also think that the establishment of a lead council member is a good idea, but how will such people—and the directors—be appointed? To whom will they be accountable?
	The Minister mentioned children's trusts at, I think, the second stage of reform. What will be the timing of that? Will all local authorities have one? Will they be standardised? Will the local safeguarding children boards be statutory, as I understand? If so, what will be the timing of the legislation? It is important that the people on the boards are sufficiently senior to be able to make decisions and allocate resources so that they can make things happen. What happens if a board fails to operate effectively?
	The Minister said that monitoring and inspection would be led by Ofsted. Does Ofsted have the skills required? It has only just bedded down into the inspection of nursery settings. We agree that national standards are needed, but who will set them? Will there be a national child safeguarding board? To whom will the standards apply?
	I welcome very much the announcement that there will be a children's commissioner for England. It has long been called for by all the children's organisations. This is an example of how the Government have listened to the experts, and they must be congratulated on that. We hope that the commissioner will be the strongest children's commissioner in the UK and that we will learn from experience in Wales, Northern Ireland and Scotland. I echo the question asked by the noble Baroness, Lady Blatch: will the commissioner be truly independent and act for all children, not just those in care? We would like to know more about his or her powers. For example, will he or she be consulted on all new and proposed legislation? Will he or she have the ability to lead inquiries and investigations? Will he or she have unlimited access to information and organisations? Will there be more than one commissioner, or will there, for example, be a commissioner for each region? To whom will the commissioner report? Those are important questions that must be asked.
	There are two gaping holes in the Statement. One is the fact that our attitude to violence against children must change. There should be no protection in the law for someone, whoever they are, who violently assaults a child. Do the Government intend to address that? Also, there was nothing in the Statement about listening to children. That is vital, and I hope that there will be something in the Green Paper about it.

Baroness Ashton of Upholland: My Lords, I hope that the House will forgive me if I keep my preamble brief and say to the noble Baronesses, Lady Walmsley and Lady Blatch, that I am grateful for their support for the thrust of what the Government are trying to do. I will endeavour to answer all the questions as briefly as I can.
	There has been much speculation about the Statement in the press. We have tried hard to make sure that we followed the processes properly, so the speculation has always been precisely that. Noble Lords will forgive me if I make the point that we talk carefully to our partners. There was a lot of discussion before the Statement was issued. There was a delay because—I can vouch for it myself—the Prime Minister wished to be involved in the launch, and noble Lords will know that, this morning, he was. That was the basis on which the timetable was set. I agree with the noble Baroness, Lady Blatch, that there should be an early debate. I would welcome it, and I believe that, between us, those of us on the Front Benches can ensure that it happens.
	The noble Baroness, Lady Blatch, immediately raised the issue of the trafficking of young people. That is a very important issue. The needs of such young people are considered to be as important as those of any other child in need, and they remain part of the thinking behind the Green Paper.
	The description of the multi-disciplinary teams is different from the traditional one. That is partly because we are removing barriers, including those affecting budgets, by means of the children's trusts. That will enable money to flow more freely and remove one of the great institutional barriers, as professionals have told us and, no doubt, other noble Lords. It will also make sure that we bring together the different parts of our society. I trust that, when noble Lords have had the chance to read the Green Paper, they will see that we involve a range of agencies, many more than have traditionally been involved in health, education and social care. In the Statement, I mentioned, for example, the important role that the police would play.
	It is important that we do not place extra burdens on teachers, as the noble Baroness, Lady Blatch, said. Our purpose is to decrease the burden on teachers. If services are working in schools—providing, for example, speech therapy, social care, educational welfare and so on—several things happen, not the least of which is that children have such services provided at school and need not travel outside school and disrupt their education. Teachers also find that they have other professionals to talk to and that a better plan of action can be taken forward. That is our purpose, and we will ensure that that is what happens.
	As the noble Baroness, Lady Blatch, said, it is important to protect teachers. We issued new guidance in May, entitled What To Do If You're Worried A Child Is Being Abused. It sets out for teachers and other professionals precisely what they should do, covering the points about protecting youth professionals, while ensuring that they know where to go, what to do and who to talk to.
	It is important that we recognise the need for confidentiality, and it is of paramount importance that we should be able to share information. Noble Lords who have read the report of the Climbie inquiry and other such reports will know that the sharing of information is critically important. I take the points—they have been made forcefully by the noble Countess, Lady Mar, in correspondence and in your Lordships' House—relating to the particular circumstances surrounding, for example, Munchausen syndrome by proxy. None the less, the thrust of what we are doing is to ensure that children are protected. Sharing information is critical if we are to achieve that.
	From the report produced by the noble Lord, Lord Laming, we have started to implement in some form about 83 proposals. It is difficult to go through them in detail now. The responses to the noble Lord's work published alongside the Green Paper show that we have accepted 86 proposals totally and 19 in principle. We have rejected one, accepted one in part and accepted one in principle in part. I know that the noble Lord is pleased with our response in that respect.
	The noble Baroness, Lady Walmsley, raised the issue of finance. Some £45 billion is spent in this area. Much of our work concerns the reassessment of how we can use the money more effectively, as noble Lords would expect. Discussions on funding are ongoing as part of the spending review.
	Training is critical. Noble Lords will see in the document that core training for social workers, in particular, and for all those involved with children will be the same throughout all services. That is very important. The performance of all Ministers is monitored through Parliament. As far as I understand, the relevant Select Committee is the Education and Skills Select Committee, although that may change.
	Discussions are continuing about how to use the parenting fund of £25 million to ensure that those resources are used better and more effectively. We also have an ambition to see a children's trust or something similar in each local authority area. That is our preferred model, and we will legislate at the earliest opportunity to ensure that all the issues can be dealt with.
	Listening to children was a critical part of the work done in preparing the Green Paper. Noble Lords will see in the information pack that, as part of the overall consultation, we have designed a specific consultation document to allow children and young people to respond.

Baroness Thornton: My Lords, I welcome the Statement made by my noble friend the Minister. To achieve their objectives, the Government must use all the levers at their disposal.
	There are three specific issues that I would like to ask about. It seems that the final shape of the corporate performance assessments for local authorities will be crucial. Can the Minister comment on that? Also crucial will be the outcome of the 2004 spending review. That is code for—I echo a question that has already been asked—"Will additional resources be made available?". Thirdly, noble Lords will not be surprised that I wish to raise the issue of the children's voluntary sector, which can be a potent agent for change. In many respects, the proposals require statutory bodies to become more like voluntary ones, with more flexibility and more use of partnerships. Many in the voluntary sector already deliver children's services. My noble friend said relatively little—nothing at all, really—about the role of the voluntary sector, so I would be grateful for her comments on that.

Baroness Ashton of Upholland: My Lords, I am grateful to my noble friend. Performance assessment discussions are under way, but within the Green Paper we flag up the need to work across government and the important roles of the Office of the Deputy Prime Minister and others to help us deliver. The spending review 2004 is important. However, I reiterate that £45 billion is to be spent on all services to children. There will be scope to be more effective in the use of that money, but it is an unprecedented level of which we should not lose sight, while, as always, we look for more funding.
	The voluntary sector is critical. I mentioned Home Start in the Statement made by my right honourable friend the Secretary of State for Education and Skills. I recognise not only the flexible approach of the voluntary sector and the need for local government and so forth to consider how flexible they could be, but also the critical delivery role of the voluntary sector to enable us to ensure that all children are protected. I know that I do not need to say that to my noble friend because of her involvement in NCH Action for Children, but I am sure that is a critical part of the Green Paper.

Baroness O'Cathain: My Lords, I, too, thank the Minister. As she said, every child matters. The protection of children is at the heart of all services. It worries me that in order to ensure that every child matters and that children are protected, a huge edifice of bureaucracy is being built. How are people on the ground in local government services likely to view this? Will they say that it is not their responsibility but that of the children's commissioner or someone in Whitehall? In setting up this huge edifice, will responsibility be pushed up and therefore not be on the ground where it matters?

Baroness Ashton of Upholland: My Lords, on looking carefully at the Laming report, the two key factors are those which the noble Baroness raised—that is, the issues of bureaucracy and "not my responsibility". It is clear that within our legislative framework and the roll-out of the Green Paper, anyone working with children should recognise their responsibility to those children in an effective manner. They should manage that role as well as feeling that they have some responsibility still to children. We want to stop the sense of "it's not down to me" which was prevalent in all at which the noble Lord, Lord Laming, looked.
	The bureaucracy occurred because so many different agencies operated in different ways. In the case of Victoria Climbie, if basic procedures had been followed she may not have died in such tragic circumstances. What is underlying that is precisely the opposite to that which the noble Baroness fears. We want to remove bureaucracy enabling people to work more closely, to operate in a way that gives them a framework, to recognise their responsibilities and to be clear about that. We want to give them clear lines, direction, training and support, while making it clear that somewhere in these layers—which inevitably exist in any management structure—because we are creating a director of children's services, in a sense the buck stops there.
	That will make a big difference. When I chaired the health authority in Hertfordshire, my experience when creating children's schools and families was that people were enabled to think about the framework of children differently. The noble Baroness will know that many professionals have wanted that cultural change for a long time. It is as critical as anything that we can do as regards legislation and resources.

Baroness Howarth of Breckland: My Lords, last week I marked 40 years in social work. I began in children's departments, happening to be the director of social services in Brent when Jasmine Beckford died, and setting up Childline. For the past three days I have been at Windsor running a multi-disciplinary conference for the Sieff Foundation, looking at the new proposals. On that basis, I welcome the Green Paper. We could all look back and say that many of these things have happened before. But this is new and exciting. The message is that local councils, local workers, social workers, teachers, police and doctors are all ahead of the game. There are some extraordinarily exciting multi-disciplinary projects already moving forward that will show the way. The Government representative said that the Government are somehow behind the game, but this is a really good move forward.
	However, there are some issues that I should like to mention. First, there is great difficulty in multi-disciplinary working, to which I believe the noble Baroness, Lady Blatch, alluded. If the boundaries that professionals have are eroded, the perspective which needs to be taken can be lost. That was clear in the Climbie inquiry. The police lost their investigative edge and thought that social services were conducting the investigation, which, clearly, was a criminal and not a social work investigation. In any training, it must be clear that people understand the nature of the boundaries of the work they undertake. If new breeds of people are to be developed, which I can foresee, they must be clear about when they should take action.
	Secondly, I can look back on many inquiries—the noble Lord, Lord Warner, headed one—when the improvement of the lot and status of social workers was discussed. At the Sieff conference it was the belief of all disciplines—including, psychiatrists, police and doctors—who said time and again that social workers are key to caring for children and to promoting their welfare and protection. We should not go again on that roundabout of giving lip service but not actually taking any action. One of the keys is to change the model of practice. Social workers should not move into management and stop practising. They should move up the line. I have practised all my life. It has not always been the right thing to do, but I have always felt it appropriate to maintain skills.
	It is terrific that there will be a commissioner for children in England, where it will need to be different. In many parts of the country there will be need to be some regional focus. Again, I should like reassurance on independence. I look forward with great enthusiasm and congratulate the Government on an excellent Green Paper.

Baroness Ashton of Upholland: My Lords, I am grateful to the noble Baroness for her comments and pay tribute to the quality and quantity of work that she has undertaken over a number of years to support children and their families. The noble Baroness raised three points. I shall be brief. I agree that it is important to have the nature of the boundaries of the work that professionals are doing understood and recognised. I hope that with the duty to safeguard children, which will be a requirement on all professionals, that will be explored more fully and is seen as paramount in their work.
	In the Green Paper, we talk about the kind of new career pathways available for social workers. As the noble Baroness said, that will enable people to remain on the front line and develop their careers in different ways. That includes moving sideways, which is within the gamut of different things one can do to support children, and should be offered on many more occasions. I did not answer the question earlier, but the commissioner will be entirely independent from government.

The Countess of Mar: My Lords, I, too, am grateful to the Minister for repeating the Statement. I shall confine myself to the interest that I have expressed frequently in the House. In talking about support for families and carers, will the Minister bear in mind that many of the mothers with whom I am concerned—mothers of children who have been diagnosed with physical illnesses—who are accused of Munchausen's syndrome by proxy, are vulnerable themselves? They are often single mothers who have not got a mother or granny or aunt around the corner to support them. They need sympathetic handling from social workers.
	I am not attacking social workers. I have never attacked social workers. I have huge sympathy for them because I think that society expects too much from them. These mothers are more likely to ask for help. While I accept that there should be early intervention, it should not be too heavy. Over and over again I have been told how these mothers have been presented with a huge panel of people from all disciplines. I am all for multi-disciplinary working, but these mothers have never before encountered authority. They have never had to employ a lawyer or go to court. They are in a very difficult situation.
	The noble Baroness did not mention at all the guardian ad litem system, which I understand has more or less collapsed. The guardian ad litem provided wonderful support for children. The noble Baroness, Lady Walmsley, mentioned the need to listen to children. In a guardian ad litem, children have a truly independent guardian rather than one employed by the local authority. The guardian ad litem might be paid by the local authority, but is not employed by it. The system is very necessary and I hope that the noble Baroness will bear it in mind for the future.

Baroness Ashton of Upholland: My Lords, I thank the noble Countess for her comments. Munchausen's syndrome by proxy is a difficult matter for us to debate in the short time available. However, it might reassure the noble Countess that, in developing our strategy, we are looking to early intervention in order to prevent crises arising either for the family or for the child. By moving away from a system where many different professionals provide many different interventions to identifying a person with key responsibilities for a child, it will be much easier for the child, the family and the workers to understand the issues and thus deal with them effectively.
	I turn to the point made by the noble Countess about the guardian ad litem system. That is something in which I believe the commissioner will be particularly interested and I shall certainly pass on her comments.

Iraq and the Middle East

Baroness Symons of Vernham Dean: My Lords, with the leave of the House, I shall now repeat a Statement on Iraq and the Middle East being made in another place by my right honourable friend the Foreign Secretary. The Statement is as follows:
	"I should like to make a Statement on Iraq and the Middle East. Let me begin with Iraq. When I last updated the House on 15th July, we had witnessed the formation of the Iraqi Governing Council and successful military operations against elements of the old regime. Subsequently, in late July, there were the deaths of Saddam's two sons. The reaction to this in Iraq, including in the Sunni towns north of Baghdad, spoke for itself.
	"The political process was advancing too. On 14th August, the United Nations Security Council adopted SCR 1500 which welcomed the establishment of the Governing Council and created the United Nations Assistance Mission for Iraq. But, as the House is well aware, these positive developments have since been overshadowed by a series of atrocities. There was the bombing of the Jordanian Embassy on 7th August which claimed the lives of 17 people. This was followed on 19th August by the attack on the UN headquarters in Baghdad which caused the deaths of UN Special Representative Sergio Vieira de Mello and 21 others. Then, on 29th August, there was the assassination of Ayatollah Hakim in Najaf in a car bomb which killed over 100 other worshippers.
	"Altogether nine Britons have lost their lives since the House rose on 17th July. In the south of Iraq, three separate attacks on 14th, 23rd and 27th August have seen the deaths of five British soldiers from the Queen's Lancashire Regiment, the Royal Military Police and the Lowland Regiment of the Territorial Army. And last Thursday, Ian Rimell, a British mines clearance expert, was murdered in northern Iraq. I know that I speak for the whole House when I say that our deepest condolences go to the families of the British victims, and to the loved ones of all those killed by terrorists in Iraq, be they soldiers, international civil servants, Iraqi political leaders, or Iraqi civilians going about their daily lives. I pay particular tribute to Sergio Vieira de Mello, who was an outstanding international diplomat.
	"I know the House will wish to join me in offering our deepest sympathy to the family and friends of Fiona Watson, who died in the bombing of the UN headquarters in Baghdad. Many colleagues will recall, as I do, that Fiona was a highly regarded officer of this House who worked as a senior researcher in the international affairs and defence section in the Library of the House between 1992–97. Her subsequent work for the UN Secretariat was recognised as being of the highest quality. She will be greatly missed both by former colleagues here and by her fellow officials at the United Nations.
	"Investigations are under way to bring the perpetrators of these and other acts of terrorism to justice. The attacks appear to come both from supporters of the Saddam regime and from terrorist groups from elsewhere in the region. What is clear is that these groups decided to target the United Nations and those, like Ayatollah Hakim, working so constructively and courageously for a new Iraq precisely because they could see the progress which the United Nations, the Coalition Provisional Authority and the Iraqi Governing Council were making. They wished, literally, to blow this process apart. The threat from the terrorists is now not just to the coalition forces, but to the Iraqi people and to their future.
	"This is now increasingly recognised by the international community as a whole. Whatever view was held about the military action itself, there is a determination across the civilised world that we all have to ensure that the terrorists fail in their objective. For our part, we will not be deterred from our goal: to hand sovereignty to the Iraqi people as quickly as possible in conditions where they can build a secure and prosperous country, for sovereignty can be fully exercised only in a climate of security. It is for this reason that the continued presence of coalition troops is vital if Iraq is to manage the transition to representative government and to build a society based on tolerance, respect for human rights and the rule of law.
	"At present there are 140,000 United States troops and over 10,000 British troops in the country. Another 15,000 troops have been provided by 25 other nations, including 5,500 from five existing EU member states, plus 2,300 from five EU accession countries.
	"As my right honourable friend the Secretary of State for Defence has told the House earlier today, we will be deploying additional troops in the near future to the UK area of operations in south-eastern Iraq. This deployment will give extra capabilities to our commanders in theatre and increase our capacity to help rebuild Iraq's infrastructure.
	"Urgent action is also being taken to build up Iraq's own security forces. Police numbers now stand at 37,000, and this figure is planned to rise to some 70,000. The training of the new Iraqi army has begun with a target of three divisions by mid-2004. An Iraqi civil defence corps of 14,000 is being trained and rapidly expanded to take over many guarding and patrolling duties, freeing up coalition forces for more demanding tasks.
	"On further evidence relating to Saddam Hussein's illegal weapons programmes, the Iraq Survey Group continues its work, albeit in a difficult security environment. This is a long-term task. The ISG will make a progress report at the appropriate time.
	"I do not in any way underestimate the scale of the security and other problems that we face. They are very serious. But we should not lose sight of the effective work of the Coalition Provisional Authority under Ambassador Bremer and coalition forces, and work by the Iraqis' own Governing Council and Ministers. This week, Sir Jeremy Greenstock, our former Ambassador to the United Nations, will be going out to Baghdad as the Government's Special Representative. Last month, Sir Hilary Synnott, our former High Commissioner in Pakistan, took up his post in Basra as the regional co-ordinator for the CPA in southern Iraq. I know that the House will join me in sending them our best wishes.
	"The international staff in Iraq, including many Britons, are doing vital work in difficult circumstances. The delivery of essential services is gradually improving. Food distribution systems are restored. All 240 hospitals in Iraq are functioning. With the help of UNICEF, over 22 million doses of vaccine have been provided, enough for over 4 million children. By the end of June most schools in Iraq were open. We have launched an upgrade of school facilities. Some 70 million revised textbooks will be printed by the end of December, and universities have been operating as normal.
	"The water sector is obviously one of the top priorities. Projects are in hand in Baghdad and elsewhere to upgrade existing treatment plants and build new ones to serve 11.5 million people. But the network has been badly hit by organised sabotage, exacerbated by shortages of parts and chemicals.
	"Electricity and oil supplies have also been targeted by the terrorists. In response, an Iraqi force is being trained and armed to guard Iraq's oil and power facilities as well as its bridges and dams. Iraqis are helping coalition troops to secure the 19,000 kilometres of power lines and 7,000 kilometres of oil pipelines in Iraq.
	"Our Department for International Development is moving quickly to allocate new funds for an emergency infrastructure programme in southern Iraq.
	"One of the immediate consequences of the bombing of the United Nations building in Baghdad on 19th August has been a scaling back of the United Nations' presence in Iraq. We are in close touch with the United Nations about what further security measures can be put in place to help it restore its activity in Iraq.
	"Over as short a timescale as possible, our goal is to create the conditions in which the Iraqi people can take responsibility for the governance of their country. Two months after the formation of the Iraqi Governing Council, it is now heavily involved in the key economic and political decisions. On 3rd September the council appointed 25 interim Iraqi Ministers. From now on, Iraq's government ministries will be led by Iraqi politicians, responsible for implementing policy and managing their budgets. Along with the Governing Council and the CPA, these Ministers enjoy full rights to initiate policy. The overall effect of this change has been a significant transfer of responsibility from the CPA to the Iraqis, a process that should accelerate from now on.
	"On the international front, I have been working closely over recent weeks with Secretary Powell and my colleagues within the EU and elsewhere to strengthen the UN's mandate in Iraq. A draft resolution is being discussed at the Security Council. Let me set out its central elements.
	"The draft reaffirms the UN's support for the work of the Iraqi Governing Council. It calls on the Governing Council to submit a timetable and programme for the drafting of a new constitution for Iraq and for the holding of democratic elections. The aim is for the UN to be heavily involved in preparing the electoral register and other electoral processes.
	"The draft proposes a UN-mandated multinational force under existing unified command arrangements. This should facilitate the provision of troops by other countries.
	"Finally, the text refers to next month's conference in Madrid, which will be attended by a number of potential donor countries and the international financial institutions, and calls upon UN member states to help the Iraqi people by providing resources for rehabilitation and reconstruction.
	"Discussions on the draft resolution will resume in New York later today. I will of course report the outcome to the House and make any public text available to the House.
	"Let me now turn to the MEPP. I very much regret the resignation of Abu Mazen over the weekend. We had confidence in him and we supported his efforts to deliver the Palestinians' implementation of their road map commitments in a difficult climate of violence and uncertainty. It was of course Abu Mazen's appointment itself in April which triggered the publication of the road map, which in turn sets out the objective of a secure state of Israel and a viable Palestinian state and how to achieve this.
	"But his resignation should not send the peace process back to square one. The Palestinian leadership must unite around a clear commitment to road map implementation. It needs to take firm action to stop the terrorists planning and executing attacks, like the appalling 19th August bus bombing in Jerusalem, from territory under Palestinian Authority control.
	"The Speaker of the Palestinian Legislative Council, Abu Ala, has now been nominated to take over from Abu Mazen. Abu Ala is a Palestinian leader with a long track record of efforts for peace. If his appointment is confirmed, we will judge him by his commitment to the peace process.
	"Similarly, we shall continue to encourage Israel to meet its obligations. Israel must create the climate within which moderate Palestinian leaders can prevail: by freezing settlement activity; by removing outposts, illegal even under Israeli law; by restoring Palestinian freedom of movement and so allowing economic activity to restart; by ending 'targeted assassinations'; and, lastly, by ensuring that the security fence does not encroach on Palestinian land.
	"The House will wish to know that I have today spoken to Nabil Shaath, Colin Powell and Silvan Shalom about these issues.
	"In turn, the responsibility of the international community is to do everything it can to hold both sides to their commitments under the road map and to isolate the terrorists, and we will continue to play our part. I welcome the fact that the EU is taking a lead here. On Saturday, EU Foreign Ministers unanimously agreed that the Union should freeze the assets of Hamas.
	"In respect of both the Middle East peace process and the situation in Iraq, Britain is seeking, in partnership with others, to bring its influence to bear on a region which has suffered unimaginable torment for decades. In recent months, thanks in part to our actions, the people of the area have reason to believe that a peaceful and prosperous future might be within their reach.
	"This prospect must be kept alive against those who would plunge the region into chaos. We are determined to work with the international community to establish peace and security across the Middle East. Despite the setbacks of recent days and weeks, this is the course we shall continue to pursue".
	My Lords, that concludes the Statement.

Lord Howell of Guildford: My Lords, we are all very grateful, I am sure, to the noble Baroness for repeating this major Statement on events in the Middle East. There have been many events since we last met here, most of them very tragic and very bloody, including the murder of six more British soldiers and other Britons and, particularly tragically, the murder of Fiona Watson. We join with Ministers and the Government in sending our deepest condolences and sympathies to the families of these heroes.
	Let me begin with the question of greater troop deployments, as set out in the written Statement of the Secretary of State for Defence. It refers to additional protection being provided by extra troops. What does that mean? Does it mean that such protection will involve expanding existing areas of operation and creating new ones, or does it mean merely replacing or reinforcing troops in existing areas? I gather that some of the troops will be going back for the second time. This is a very hard grind.
	Is the Minister convinced that sending extra troops in the form of two more infantry battalions is the answer to the difficult and complex terrorist and security situation that has developed in Iraq? After all, more troops means more targets. Can the Minister assure the House that, in addition to soldiery, the Government are considering and planning for the provision of more policing experts, more electrical and water repair and installation engineers, more anti-terrorist intelligence experts and experts in low-intensity warfare of the kind in which this country is enormously expert thanks to our experience in Northern Ireland, of which I also had experience back in the 1970s?
	Large areas of Iraq are peaceful—we must not exaggerate the appalling difficulties, serious though they are—and the security problem is relatively localised in certain danger areas. It is in these areas that the whole anti-terrorist effort should be concentrated using the right personnel and the right equipment. If there are to be more troops in addition to those provided by the existing coalition allies and our own contribution, where are they to come from? In attracting more troop contingents from other countries, how much depends on there being a bigger role for the United Nations?
	Everyone, including the Americans, now seems to agree that there should be greater UN involvement in Iraq. How is that to be organised? Can military and political roles be split, as some have suggested, with the proposed UN-led force carrying out a peacekeeping role, when there is peace, and the main military efforts still being borne by the coalition forces? Does the draft UN resolution to which the Foreign Secretary refers go far enough to attract the contribution of more countries which have been hesitating, such as India, Pakistan and Turkey? Can the United Nations handle this big a role? Does it want to after the horrific murders at the UN building in Baghdad, or should it first have the fundamental reassessment, to quote the words of Kofi Annan, about which he has been speaking in recent days? These questions should be examined before one accepts that a vastly greater burden should be placed upon the UN.
	We have to ask what France and Germany are playing at. They, too, have said that they want the UN to be completely in charge; however, they have also said that they do not want to participate in or validate any activity which would somehow suggest approval of the invasion which they were against from the start. Do they have the troops, anyway? I am told that the French military are completely committed elsewhere, while the Germans are heavily committed in Afghanistan.
	We welcome the setting up of the governing council and the appointment of Ministers in a Cabinet as a step forward. But is not the real answer to the Najaf horror and the horrible hints of disintegration and civil war a much stronger Iraqi police force and a revived Iraqi military? I strongly welcome the suggestion that moves are being made in that direction, but surely the Iraqi army should never have been disbanded in the first place. That was a major United States mistake, and we welcome the efforts indicated in the Statement to repair that error now and bring into being at least the junior and middle ranks of the Iraqi army, if not the top ranks.
	On the Israel/Palestine question, it is hard to find any room for optimism. The road map is clearly in tatters; everyone has been the loser after the horrific events of recent weeks. The truce was shattered by the suicide bomb atrocity of 19th August in Jerusalem. The targeting of civilians and children, with dead children lying in the road, has been met by the inevitable response of more targeting of Hamas leaders. That, in turn, has led the Hamas leaders to say that "every Jew is a target". So the miserable roundabout of violence and hatred spirals on.
	Strong words are being said about peace, and we hope the process can be revived, but what other practical moves can we take? Can we be assured that the European Union has ceased completely to support the Hamas killers in any way? That is what the Statement says, and I hope it is so. It seems regrettable that the European Union was doing so until recently—that should have stopped long ago. Let us at least act on that front and be assured that that action is decisive.
	Finally, let me turn to the weapons of mass destruction. Have programmes been discovered? Have more weapons been identified? There have been a number of stories during the past few weeks but nothing very definite. There was mention of the Iraq Survey Group report. When exactly will that be produced? I had heard it would be next week but there seem to be doubts about that.
	I leave aside, for the moment, the matter that has occupied the media for the past few weeks—the Hutton inquiry into the death of Dr Kelly. No doubt we will deal with that in future debates, but is it not now essential to reassert the important and basic reasons—which we on this side fully support—why we are in Iraq, why we are asking our brave troops to operate there under such tricky conditions and what our goals and objectives really are? It is important for such confident and clear statements to be remade, and very clearly. The sooner that is done, the better.

Lord Wallace of Saltaire: My Lords, I, too, thank the Government for the Statement. It is very difficult to comment on such a broad Statement about such a very dangerous region in such a serious situation. We on these Benches have argued throughout the last two years that one has to take the conflicts in the Middle East as connected, as the Americans and many Muslim countries always have. The connection between the invasion of Iraq, the problem of terrorism in the region and the Arab/Israeli conflict is one we must all grasp.
	We bitterly regret the casualties and the atrocities of the last few weeks. We acknowledge the useful progress made by the Coalition Provisional Authority, although we regret that insufficient troops were provided, for ideological reasons within the Pentagon, and that there was, for similar ideological reasons—and here I follow the noble Lord, Lord Howell of Guildford—an unfortunately slow approach to reconstituting local forces for security. The unease on these Benches throughout this long process has partly been because of what we have seen as a mistaken analysis, particularly within the Pentagon but elsewhere within Washington as well. There has been a deliberate discrediting in Washington of regional experts on the Middle East in favour of an approach to the region which seemed to us fundamentally mistaken. That included the idea, which even Henry Kissinger stated on a number of occasions, that the road to Jerusalem runs through Baghdad, and the invasion of Iraq would thus lead to a successful peace between Israel and Palestine.
	The Statement talks about the United Kingdom working in partnership with other states. What is the balance between the partners? Is it UK policy still, in effect, to follow the uncertain trumpet of American policy, or have we returned towards closer co-operation with other EU governments in persuading the United States to modify its position? As the Minister will know, we on these Benches have had some sympathy with the French and German position throughout this conflict. We should be working more closely with our European partners in trying to push the very confused debate in Washington in a more constructive direction.
	How strong will the UN engagement be? Can we be assured that the details of the UN resolution will mean not simply a continuation of US command with a supplementary role for the UN but a real role for the UN, including the active engagement of Muslim countries? One of the things that depresses us most in following the debate within Washington is hearing that we are faced with a fourth world war between the West and the Muslim world. The article by Amity Shlaes in the Financial Times last week used exactly that phrase. I hope that Her Majesty's Government in no sense share that perspective.
	Paragraph 13 states that the international survey group will report at an appropriate time. That is a wonderfully vague phrase. Do the Government think an appropriate time will be in 2003 or possibly 2004 or 2005? I think we are entitled to a rather more definite date than that.
	On the Middle East peace process, we have again been hampered by a deeply mistaken analysis in Washington. None of us should underestimate the seriousness of the situation. It looks as if the road map has collapsed; the cycle of violence on both sides may lead towards a more general conflict. In this regard, aspects of the Statement make me uneasy. References to the Palestinian leadership are made in the form of demands that they must unite, whereas, when it comes to Israel, we are to continue to encourage her to meet her obligations. Let us be clear. Neither side has been meeting its obligations. Targeted assassinations and the destruction of Palestinian farms, groves and houses breed further terrorism within the Palestinian world.
	Reference is made to the freezing of settlements. Can we please be a little more honest and say that, unless there is a reduction in the number of settlements, there cannot be a viable Palestine, thus there cannot be a two-state solution? Can we be clear—as the Israeli press has argued in the past few days—that the future route of the fence or wall is vital? Unless the future route of the wall goes close to the 1967 boundaries, there will be no prospect of a viable Palestine, and thus no prospect of a viable two-state solution.
	We would like Her Majesty's Government to insist that a two-state solution is the only acceptable outcome, and that such a solution can be built only on boundaries close to the 1967 boundaries, allowing for a viable Palestinian state to emerge. Perhaps it would be better now to move from the stage proposals of the road map to the final status negotiations to make that clear.
	How many troops will be sent? A figure of 5,000 has been suggested. I think that the House is entitled to a little more clarity. Lastly, paragraph 19 refers to further funds being allowed. There is some concern, as the Minister will know, within the development community that the situation in Iraq will lead to an immense diversion of funds from development in other countries. Can the Minister give us some reassurance that the development budget will not be gradually sucked up in reconstructing Iraq?

Baroness Symons of Vernham Dean: My Lords, I thank the noble Lords, Lord Howell of Guildford and Lord Wallace of Saltaire, for their reception of the Statement. I will attempt to deal with the points that they have raised.
	The noble Lord, Lord Howell, said that a great deal had happened since we last met. Indeed it has. I am sure that we all mourn the British losses. I thank the noble Lord for joining Her Majesty's Government in expressing sympathy over those losses.
	The noble Lord asked about troop deployments and whether the area of operation would be expanded. As I understand it, it is hoped that the troops will be able to deepen their activities rather than expand the area in which they are operating. In answer to the point raised by the noble Lord, Lord Wallace of Saltaire, I understand that the figure is about 1,500 extra troops—the number encompassed in the announcement earlier today by my right honourable friend the Secretary of State for Defence. I say to both noble Lords, but particularly to the noble Lord, Lord Wallace of Saltaire, that this is being undertaken on military advice from commanders in the field. We will continue to receive reports from them and will keep matters under constant review. More peace experts are going in, and there is more training for those who will be charged with protecting water, fuel and power. As I say, the military commanders will be feeding back information all the time to the Ministry of Defence, so that judgments can constantly be made about what is needed on the ground.
	The noble Lord raised the question about getting more troops from other countries into Iraq. The UN resolution is under active negotiation now. There is a reference to continuing negotiation today. I understand that the P5 countries are meeting today to go into some detail on the matter. But how precisely the troops would be organised is under discussion. The noble Lord asked whether this will go far enough and whether it will attract countries such as India. These are the exact questions that have to be discussed in the course of the next few days. The Secretary-General has made it clear that he does not foresee a blue helmet force taking over security in Iraq now, but, on the other hand, there is a desire for greater participation by more UN countries.
	The noble Lord questioned the number of police. I understand that there are currently 37,000 Iraqi police. As the Statement makes clear, it is hoped that there will be 70,000 in due course. As for the Iraqi army, we are hoping that three divisions will be trained—I understand that that amounts to some 40,000 Iraqi soldiers—by mid-2004.
	The noble Lord made reference to what he termed the de-Ba'athification of the Iraqi army—a point discussed by your Lordships in the past. The fact that so many senior Iraqi officials in all walks of life, whether civilian or military, were members of the Ba'ath party was a function of the old regime. The noble Lord is right: in clearing out anyone who was a member of the Ba'ath party, a great deal of valuable expertise has been lost. I believe that we have now found a better balance on that issue.
	I turn to the points raised on the Israel-Palestine question. The asset freezing was agreed last Saturday. My right honourable friend the Foreign Secretary particularly led the argument for that asset freezing in the EU. In the past there has been a desire for a split in the understanding of Hamas activity as being military on the one hand and humanitarian on the other. I am afraid that that understanding has become less and less clear in recent years; hence the desire to have the assets frozen altogether, as was agreed on Saturday.
	We hope that the ISG report will be available soon. I say to the noble Lord, Lord Wallace of Saltaire, that the Statement stresses that this will be an interim report. I cannot give the noble Lord a date—had I been able to do so it would have been in the Foreign Secretary's original Statement—but it is hoped to have it soon. It will be an interim report. Again, as the Statement makes clear, this will be a very lengthy process.
	The noble Lord, Lord Howell, asked how we justify our continued activity in Iraq. We are rebuilding Iraq for the Iraqis. They are part of that process. As regards the political process and the momentum that we have seen, the formation of the governing council on 13th July, and on 3rd September the appointment by the governing council of the interim Iraqi Ministers, are substantial steps forward. We should not lose sight of the fact that there has been some political progress and that there is now a 25-strong constitutional preparatory committee which will be making recommendations to the governing council later this month.
	The noble Lord, Lord Wallace of Saltaire, asked me about UK policy being to follow the US. I am sure that the noble Lord will not be surprised to learn that I do not accept his premise. Anyone who knows the Prime Minister, special representive John Sawers or special representative Sir Jeremy Greenstock will know that all would be very robust indeed in saying what they had to say to the United States, or indeed to anyone else, about what we believe is important in Iraq. We want a real role of active engagement from Muslim countries. I myself have heard United States officials make exactly that point, particularly in relation to attracting countries that may be able to send Muslim troops.
	The noble Lord, Lord Wallace of Saltaire, was uncharacteristically wrong when he said that the Statement merely encouraged Israel while it said that Palestine had to do certain things. I ask him whether he will be kind enough to read again paragraph 31 of the Statement, which states:
	"Similarly we shall continue to encourage Israel to meet her obligations"—
	quite rightly—but it goes on to say:
	"Israel must create the climate within which moderate Palestinian leaders can prevail".
	It goes on to list six things which Israel "must" do. I hope that the noble Lord will give credit for the balance that I believe is in my right honourable friend's Statement on that point.
	Lastly, on the funding considerations raised by the noble Lord, there is a great deal of Whitehall conversation between departments at the moment about funding. The Foreign Office needs to see more funds in relation to these points. There are funds, and there is discussion about how these are properly to be allocated over the course of the next few weeks and months.

Lord Wright of Richmond: My Lords, I join other noble Lords in thanking the noble Baroness for repeating the Statement and perhaps I may join in sending good wishes to my close friend and former colleague, Sir Jeremy Greenstock, in his extremely difficult task.
	I want to make one point on the Arab-Israel situation. I know that there are varying views, most of them pessimistic, about the role of Yasser Arafat, but I must remind the House that it is the elected leader of the Palestinians who has appointed Abu Ala as their Prime Minister and I would caution against any continuing attempt to exclude Yasser Arafat. I ask the Minister to distance the Government from current talk about expelling Yasser Arafat from Palestine. I believe that that would have disastrous consequences and would certainly undermine and bring to a complete end any task that Abu Ala may be able to perform.

Baroness Symons of Vernham Dean: My Lords, I thank the noble Lord, Lord Wright of Richmond, for what he has said about Sir Jeremy Greenstock, who is an extraordinarily experienced and very able diplomat. I am sure that he takes the good wishes of the whole House with him in his huge task.
	As to the point that the noble Lord raised about Yasser Arafat, let me put his mind at rest. He has no need to persuade Her Majesty's Government of the importance of the role of Yasser Arafat. As the noble Lord will know, there are a number of voices that raise questions about Mr Arafat's role and some of the things that he has said. However, the fact remains that Yasser Arafat is the elected leader of his people and, while he is in that position, it is of course incumbent on all of us to deal with him as the elected leader of the Palestinian people.

Lord Campbell-Savours: My Lords, my noble friend will know that land in the ownership of Palestinians has been confiscated by the Israeli authorities. Would she be prepared to put a detailed reply in the Library as to the whether the seizure of property in the ownership of Mr Abdul Karim at Beit Eksa and Beit Souriq by the Israeli official Mr Mikka Yaven on behalf of the civil administration of Judea and Samaria is in compliance with the terms set out in the road map for peace? If it is not in compliance with the terms of the road map, in so far as we seem determined to implement it, what do we intend to do about the seizure of that land?

Baroness Symons of Vernham Dean: My Lords, there are probably quite a few Palestinians who have difficulties, given the seizure of land. The settlement activity, including road building, is creating a great deal of difficulty on the ground, and not only for individuals for whom such land seizures are a very terrible personal loss. It also makes for great difficulty in breaking up Palestinian territorial contiguity, particularly on the West Bank. That makes the possibility of a negotiated settlement very much more difficult.
	If the noble Lord will allow me, I shall take away the names of the individual to whom he referred and see what additional information I can give him. It is very important at the moment that we do everything we can to further peace. There may be some individual instances when over-exposure of what has happened to individuals may not be fully in concert with that overall direction. I hope to be as helpful as possible to him, and to be able to give him more information, if he is kind enough to let me ask the department about that matter.

The Earl of Onslow: My Lords, the Peel Commission found that dual state partition was a good idea in 1936, the United Nations tried it in 1948 and we are trying it again. The Middle East is the most depressing place that it is possible to think about. I refer to the criminal activities of the Israeli settlers and Government on the basis of Genesis 17, which says that if an elderly man changes his name from Abram to Abraham and his wife from Sarai to Sarah, he can have kiddies and they can nick the best piece of real estate on the eastern Mediterranean littoral. That is not how the authorised version of the Bible version puts it—that is essentially what Genesis 17 says. We must not go on tolerating the fact that because God said to Abraham, "You can have this piece of property—because you believe this and live in Brooklyn—you can go there and dispossess Palestinians". That is quintessentially what is happening; it is a harsh way to say it, but it is quintessentially true.
	Until we recognise the basic illegality and immorality of the disposition of one people by another, we are not going to have peace in the Middle East. I accept that we cannot go from the position in which we would have liked to be in 1917, when the Balfour Declaration referred to a situation without prejudice to existing rights, religious or political, of the existing inhabitants. Of course, we cannot go from there, but we must go to the core of the problem and try to settle it. I have not the faintest idea how to do it, but until we recognise that that is the core of the problem, we shall not even be able to begin to try to settle it.

Baroness Symons of Vernham Dean: My Lords, I am not quite sure what question the noble Earl is asking me. I have heard his views on Genesis 17 before, and I am relieved that they were less colourfully expressed on this occasion than on many others. Of course the situation is depressing, and what has happened over the past few weeks—and particularly over the past 48 hours or so—is deeply worrying. The noble Lord says that he does not have the faintest idea how we deal with the problem. The fact is that the international community does have a good idea, which is the road map.
	The road map may not so far have been met with acclaim on all sides, but I am bound to say to your Lordships that it is the only solution on the table at the moment that commands any degree of international support. It commands support from as diverse a group of opinion as the Crown Prince of Saudi Arabia on one hand and the President of the United States of America on the other, together with the President of Russia, the whole of the EU community and the United Nations. It is vital that we do not lose heart because of the activities of those who would derail it. Those terrorists would be delighted to hear what the noble Earl has just said. We must not give them that satisfaction; we must go on setting our hands to the task before us.

Lord Bramall: My Lords, for a number of reasons, some of them apparent, I was against the war, brilliantly as the initial military campaign was conducted. However, I fully recognise now that we must do what we can to finish what the coalition has started. That, as the Minister said, will require more of our own forces. Indeed, reconstruction apart, the coalition seems to have embarked consciously on the vital war against terrorism on a definite strategy, which can only be described as a Dien Bien Phu strategy. Having forced Al'Qaeda rather incongruously into cahoots with Saddam's loyalists, it intends to take on the terrorists head-on, on ground of its own choosing—that is, Iraq—and to destroy them with superior force.
	There were other ways, but that can be said to be one coherent strategy, which, although the name that I have given it implies risks, could be successful. I sincerely hope that it will be. Those supporting it—and, judging by his latest press conference, that includes our own Prime Minister—will claim that it will pre-empt later, less manageable terrorist activity, which could then be encountered only over a wider area and in much more inaccessible places. However, successful or not, it will require many troops over a prolonged period at a prodigious cost, and a very steady nerve, not only in government but in the country. Democracies sometimes soon get tired of such demanding adventures.
	The question that I put to the Minister is how the Government will reconcile that prospect with the state of our long-time over-stretched and under-funded Armed Forces, whom the last Chief of Defence Staff, my noble and gallant friend Lord Boyce, clearly warned could not undertake another commitment on the scale of the Iraq invasion, to which the impending force levels are rapidly returning, for another one to two years. When will the Government—which, of course, means the Treasury—match resources in manpower, material and money to commitments? Alternatively, when will the Government deal with our far-flung commitments more circumspectly?

Baroness Symons of Vernham Dean: My Lords, I thank the noble and gallant Lord for at least part of what he said. The details of the deployment are to be found in the Statement made by my right honourable friend the Defence Secretary, and I believe that my noble friend Lord Bach will be answering a Written Question in your Lordships' House tomorrow to give further details.
	Even in these very difficult circumstances, where security is such a huge problem—the Statement did not pull any punches; it was very clear about the security position in Iraq—it is important to look at the real progress being made with regard to the political situation in Iraq. The Governing Council was established on 13th July and the constitutional committee is due to report to the Governing Council in September; I also refer to the 25 interim government ministers. On that basis, I say to the noble and gallant Lord that I find the analogy which he has drawn with the early situation in Vietnam a rather difficult one for him to sustain. The Governing Council of the Iraqis is very much on the side of the CPA in the ambition of ensuring a peaceful handover of full sovereignty to Iraqi citizens in the shortest possible timeframe. So while I understand some of the points he has made, I think that his analogy really will not bear a great deal of critical analysis.
	The noble and gallant Lord rightly raises the point of the pressures on our Armed Forces, which I am sure that all your Lordships will understand and with which many of your Lordships will sympathise. What my right honourable friend the Defence Secretary has announced today should bring our deployment in Iraq up to something in the region of 11,500 troops—although as I already indicated to the noble Lord, Lord Howell, that may well be under review. If more suggestions are put forward by commanders in the region, no doubt those will be looked at. In terms of overstretch, however, the noble and gallant Lord will know that the British Armed Forces are currently not as overstretched as they were three or four years ago. Although that may not be a huge comfort to him, I say to him that when I sat where my noble friend Lord Bach now sits, some of the overstretch was a great deal more difficult than it is today.
	So I absolutely take the noble and gallant Lord's strictures that we must handle this very carefully and not put unendurable pressures on our Armed Forces. Again, however, I think that we have to see this in the context of the very considerable gains that there are if we are able to sustain the position in Iraq.

Lord Judd: My Lords, will my noble friend accept that there will be strong feeling among many of us in this House that we should send nothing but good will to those involved in the important negotiations at the United Nations at the moment? In the candid speaking to our American friends to which she has referred, will the Government be at pains to point out that what is central to the success of the operation now is the authority of the United Nations and accountability to the United Nations? It would be unfortunate if anything said by our American friends should indicate to the world that somehow the UN is seen as a subcontractor to be brought in to assist in an essentially United States operation. The operation has to be internationalised through the UN if it is to have credibility and the necessary international support.
	On the Middle East, will my noble friend simply accept that in speaking as firmly as she has indicated the Government are speaking to the Israelis, it is important to say that in the end peace will be found only when the Israelis speak to those who the Palestinians feel represent them rather than those who the Americans say are acceptable as representatives of the Palestinians? In that context, will she also say that what is totally wrong and unacceptable is action by the Israelis that undermines the credibility of those trying to lead the Palestinians, as distinct from assisting them to make a success of their responsibilities?

Baroness Symons of Vernham Dean: My Lords, I thank my noble friend Lord Judd for what he said about our colleagues who are dealing with these very difficult issues in the United Nations. I say to him as I have done already to your Lordships that we are keen to see the transfer of responsibility for running Iraq returned to the Iraqis as soon as possible. I believe that that is a united view of all the countries sitting round the negotiating table in the Security Council, trying to find the best means of doing that by the most helpful United Nations Security Council resolution. However, I also say to my noble friend that the CPA has very clear responsibilities. It is responsible under the Geneva and Hague Conventions for ensuring that the security and humanitarian needs in Iraq are met. So I do not want to mislead my noble friend. One cannot simply say, "Let us share it out". There are specific legal responsibilities on the CPA, and those are ours to shoulder until such time as we are able to ensure that transition of power to which I referred a moment or two ago.
	Again, I would not wish for my comments to the noble Lord, Lord Wallace of Saltaire, about our imperatives in the Statement concerning Israel in any way to undermine the very firm way in which the Government have also been speaking to our friends in Palestine. The Government are speaking firmly to both sides in this hugely difficult situation. The noble Lord spelt out points, which he said are wrong and unacceptable, about the way in which the Israeli Government have conducted some of the business around this matter. However, I am bound to say to him as well that much of what has gone on on the Palestinian side is completely wrong and unacceptable. That terrible bombing in Jerusalem was an outrage that needlessly killed many Israeli citizens and was arguably the major turn of the unfortunate sequence of events that has led us to where we are today.

Viscount Waverley: My Lords, for security reasons, the Israeli media are calling for the razing to the ground of a low-cost Abu Dhabi housing development in Gaza. Will that not provoke further attacks? Is there a concern of a Taliban resurgence and a link with what is going on in Iraq? Finally, is there recognition of privatisation as a mechanism to fund a plethora of essential projects in Iraq?

Baroness Symons of Vernham Dean: My Lords, I do not know whether, at the end, the noble Viscount meant privatisation in Iraq or in Palestine.

Viscount Waverley: In Iraq, my Lords.

Baroness Symons of Vernham Dean: My Lords, I should deal first with the first point. Anything that adds to the cycle of violence in Israel and the Palestinian Authority areas are bound to be matters that provoke one side or the other. Given the events of the past few weeks, nothing could be clearer than that violence on one side immediately excites violence on the other. As for the noble Viscount's point on privatisation, many ways are being discussed of how to attract more money into Iraq for the reconstruction. Of course there is a private sector interest in this. My colleagues in the DTI and elsewhere are discussing various means by which that may be done.

Lord Dubs: My Lords, is it the Government's assessment that the threat in Iraq is increased by terrorists from outside the country crossing across unguarded borders? If so, what are the prospects that the borders of Iraq can soon be made real borders which will be more difficult for foreign terrorists to cross and enter the country?

Baroness Symons of Vernham Dean: My Lords, the Government's assessment is that there is terrorist activity in Iraq and that not all of it is generated originally in Iraq; much of it may be generated from outside that country. If it were easy to secure the borders, such would be done. However, the fact is that there is currently a great deal of security activity going on in trying to protect the people of Iraq. We have already spoken about services such as power lines, water and the country's infrastructure which those terrorists are attacking. Not only are the forces having to look after the security of the people of that country; they are also currently very much preoccupied in looking after the maintenance of essential services.

Lord Hannay of Chiswick: My Lords, does the noble Baroness agree—

Lord Grocott: My Lords, we have had 20 minutes of questions and we have a very important Second Reading debate.

Health and Social Care (Community Health and Standards) Bill

Second Reading debate resumed.

Baroness Gould of Potternewton: My Lords, I wish to concentrate my remarks mainly on the question and definition of social healthcare, referring in particular to sexual health, and then to support briefly the principle of foundation hospitals. Before doing so, however, I must declare an interest as the chair of the Independent Advisory Group on Sexual Health and as president of fpa.
	Sexual health is an aspect of public health which is almost completely ignored in any of the documentation on the role and responsibilities of the new healthcare inspectorate and the new inspectorate for social care.
	The Minister said that CHAI and the Commission for Social Care Inspection will have the power to inspect standards, to audit spending and to report on the quality of all aspects of health and social care provision in the public, private and voluntary sectors.
	My first question to the Minister, therefore, is, will sexual health be an integral part of public health and priority in the NHS, with CHAI fully inspecting the quality and delivery of sexual health provision? If it is not CHAI's responsibility, will it be the responsibility of the social care commission? Also, will performance indicators be identified by CHAI as incentives to improve sexual health services?
	I appreciate that the Government have an action plan for sexual health. These are important steps in a long-term strategy. But improving sexual health has to be given much greater priority if we are to overcome the increase of HIV/AIDS, the explosion of sexually transmitted diseases and ignorance of the consequences of unprotected sex. CHAI has to take on board that the state of sexual health in this country is grim. It cannot be stressed too strongly that STIs and HIV are transmittable infections. Lack of immediate action will create a time bomb for the future, as the rate of infections will grow exponentially.
	Latest figures from the Health Protection Agency produced this July so clearly illustrate this growth. Genital chlamydial infection is now the most commonly diagnosed STI seen in GUM clinics. Some 81,000 cases were diagnosed in 2002—an increase of 14 per cent on 2001. Syphilis—a disease which most people assume was a disease of the past—increased substantially between 2001 and 2002 by 67 per cent in men and 33 per cent in women—the highest outbreak since 1984. Approximately 41,000 people are living with HIV, with 6,000 new infections recorded in 2002. So we have a rapid growth of infection but a lack of parallel investment.
	I refer to an example from the Commons Health Select Committee report, which highlighted the many clinic premises that are of "an unacceptable standard"—a view I can endorse, having taken the opportunity to visit some of these premises and seen some appalling conditions. Surely that is something that a new inspectorate should take on board. Premises established for seeing 400 clients are having to attempt to cope with 1,000 clients, with open door policies having to be stopped and appointment systems established. The Health Protection Agency identified 1½ million attendances at such clinics in 2002—an increase of 15 per cent on 2001.
	The problem for sexual health is also exacerbated by the lack of consultants and adequately trained nursing and support staff. Will CHAI have the responsibility for conducting a multidisciplinary review to assess service capacity, staffing, premises and supporting infrastructure? What guidance will CHAI give to provide a more co-ordinated, holistic approach to the public and sexual health agenda? I refer particularly to co-ordination as it seems to me that it is crucial. I cite as evidence the fact that NICE recently recommended free IVF treatment on the NHS, but that has not been accompanied by any reference to the rising rates of chlamydia, yet there is an identified causal link between chlamydia and infertility. Screening for chlamydia decreases cases of pelvic inflammatory disease—a significant cause of infertility—by 64 per cent. Investment now could help to forestall a huge rise in the costs of infertility treatment in the future.
	I am sure that my noble friend Lord Warner will refer to the roll-out of the chlamydia screening programme, but it is clear that a 10-year programme is too long. Surely early treatment and prevention is an evident truth. Particularly as many of the infrastructures required for central co-ordination are now in place, every effort should be made to expedite roll-out across the country.
	Fpa, Brook and the Terrence Higgins Trust have recently undertaken a review of local delivery plans published by strategic health authorities. The review showed that sexual health is mentioned in just 10 plans, HIV in seven and contraception and abortion services in none. The Government have to give a lead. That is clearly shown by teenage pregnancy being mentioned, quite rightly, in nearly 60 per cent of all local plans, with respondents citing that that is due to its being a government priority.
	Sir Ian Kennedy has indicated that marginalised communities will be a priority for the new work of CHAI. STIs and HIV are preventable diseases that increasingly affect disadvantaged communities and those on the margins of society. To achieve Sir Ian's aim as part of CHAI's evaluation work there will surely need to be the establishment of cross-cutting targets for sexual health and HIV services for PCTs and NHS trusts.
	I wish to refer to foundation hospitals but, before doing so, I shall say a few brief words on Part 4 of the Bill. The new GMS contract fragments sexual health services in a way that is at variance with the levels of the Government's agreed national strategy for sexual health—a concern expressed by the Royal College of General Practitioners' task group for sex, drugs and HIV. The consequence is that sexual health will be reduced to various clinical tasks and procedures which GPs may decide to opt out of, not least because in some areas there is a crisis in GP recruitment and retention—a particular problem in London where there is a shortfall of some 350 GPs. The approach taken under the GMS contract is not practical, sensible or holistic. For many general practitioners sexual health will disappear off the agenda. I hope that the Minister will indicate that that will not be the case.
	Finally, I turn to NHS foundation trusts. I originally had many problems in accepting the proposals for NHS foundation trusts, but the amendments introduced in the other place and discussions I have had with practitioners locally who support the proposals have helped me to change my position. I support the injection of a new element of local democratic involvement in the proposed trusts and hopefully their ability to give the NHS greater freedom to provide the best service to meet local needs, but there need to be guarantees that they will work to national standards. The role of the independent regulator has also been improved by having to be accountable to Parliament and not to the Secretary of State and by being inspected on performance ratings by CHAI.
	The Constitution Select Committee, of which I am a member, considered the constitutional implications of the Bill. In particular, it looked at how the local membership of the board of governors is to be elected. I ask my noble friend how the boundaries will be defined, by patient or by geography? How will nominations be sought so that the membership, as the Minister said, will cover all elements of society? What will be the role of local authorities? What will be the composition of the electorate and the process of elections? Who will oversee the elections to ensure that they are fairly run? These are important details—they are not trivia—if there is to be confidence in the election process.
	I still have some concerns over staffing and the means by which poaching of staff is to be prevented. While I am not as pessimistic as the noble Earl, Lord Howe, that other NHS trusts will lose out financially, there need to be guarantees that that will not happen.
	I agree with those who argue that the universality of service does not always provide fairness and equity. I sincerely hope, in supporting the introduction of foundation hospitals, that there will be greater consistency of service, greater co-operation with other NHS and community organisations and that the current inequalities in health provision will be overcome.

Baroness Cumberlege: My Lords, I start by declaring some interests, in that I am a senior associate of the King's Fund, a vice-president of the Royal College of Nursing and the Royal College of Midwives, and chair of St George's Hospital Medical School. I am involved with other charities, and work for the NHS, sometimes in a paid capacity and sometimes unpaid.
	I believe that the Bill is the first major piece of government legislation that the noble Lord, Lord Warner, will have taken through this House. It would perhaps be reckless of me to wish him every success, in that noble Lords, myself included, will of course try to amend the Bill. It is a colossal Bill. I wish him well and, above all, I wish him stamina.
	I hope that the Minister will recognise our concerns. Some noble Lords here today, and others not in the Chamber, will actually applaud the Government's intention to devolve. Some of us even admire the rhetoric. However, as my noble friend Lord Howe said, it is the detail and the lack of coherence that is deeply troubling. The Government, in moving from the days of spin to counter-revolution, are in danger of gearing the engine so fast from one direction to the opposite direction that it is in danger of blowing up, I fear. There are major changes in the Bill, and I hope that our constructive amendments will help to ensure that we move smoothly into the change of gear.
	I speak in this debate in the spirit of a Second Reading, and I shall leave the detailed points that I want to make to Committee and Report, but I would like to thank those who have sent me briefings and say that I hope to do justice to their concerns later.
	My first point is a constitutional one, but it perhaps goes wider than that made by the noble Baroness, Lady Gould of Potternewton. I have a considerable worry that, in future, Bills taken through another place by a majority that relies on votes of Members of Parliament from Scotland and assemblies in Wales and Northern Ireland will be challenged in the court of human rights and, if found to be unconstitutional, will become void. As a revising, advisory and perhaps warning Chamber, should we not find some method to test the validity of the votes before we start to plough through eight days or so on the minutiae of the Bill? I am concerned, and I seek the advice of those noble Lords expert in constitutional law and perhaps of the committee to which the noble Baroness referred. Perhaps the Minister will also seek advice to ensure that our work, and his, is not wasted.
	Although I acknowledge that the Bill, in the creation of foundation hospitals—whatever they will be called in future—marks a change, it is in reality not much more than a natural progression for the whole system of NHS acute trusts, which was the work of a previous administration. As my noble friend Lord Howe said, the 1997 Labour revolution was the seizure of power away from trusts back to a highly centralised system, to the point where, in effect, the Secretary of State was appointing, disappointing and firing chief executives, bypassing local trust boards.
	The purpose of the Bill is to effect a counter-revolution. The difficulties, as voiced by those in opposition to the Bill—Labour Members of Parliament, academics, trade unions, professional organisations and others—is that local autonomy works against the Labour philosophy of equity. While we have a national health service, which of course I strongly support, we shall always struggle with devolving to local management a national health service, because the two are opposites. Anyone with experience of any organisation will know that excellence attracts excellence. Excellence in medical and nursing services produces better outcomes. It is right that foundation hospitals should aspire to attract the best staff, as any hospital should, but with a strong desire for equity, how will the Government reconcile unequal freedoms with equity?
	As a district and regional chairman, and later as a Minister, I have spent more than 20 years visiting wards and hospitals. The variations in performance and outcomes are as variable as the numbers of people employed. Two people can clean the same ward and the result will be different. Two people can treat the same patient and the result will be different. Of course we have to insist on the highest standards, but to expect a management system to,
	"guarantee a greater equality in outcomes"—
	I quote from the Government's brief—is actually naive. It is no more likely that every school with a set curriculum can obtain the same pass rate in examinations. We know that the variations are vast.
	Although I have every sympathy with the Bill's acknowledgement and reward of excellence, there is no doubt that it will not further the cause of equality in health outcomes. That must be a huge dilemma for the Government. As elections draw near, there is a great danger that Ministers will believe that by assuming more central control the service will become more equal. In fact, probably the best that can be achieved is to cover up variations within national statistics.
	In reality, the all-important measure is whether patients have faith in their treatment, their doctor, their nurse. Patients are forgiving where the staff have done their utmost. What is inexcusable is neglect of duty. The system of removing incompetent members of staff, whoever they may be, is so difficult, time-consuming and expensive that bad practice and therefore bad outcomes are often condoned. If every hospital could more easily dismiss non-performing staff, the NHS could be improved quicker and by a far greater extent than by the hugely expensive bureaucracy of regulation and inspection proposed in the Bill.
	It is not easy to see any consistent principle running through even the major part of the Bill. There is freedom for the best, almost totally constrained by regulation and targets. There is scope enough for politicians to step in and strangle freedom. I believe that the moment has arrived when we must admit that politicians are not good managers, and that the management of the NHS should be removed from politicians. We should also be honest and accept that variations are inevitable, although of course every effort should be made to improve standards. What we should no longer tolerate is the NHS being messed about by politicians for political advantage. It is time we thought more about keeping people well and caring for the sick, and about putting their interests first.
	I congratulate the Government on some of their initiatives, not least the national service frameworks. However, they have also wasted billions of pounds taking the NHS for a huge circular tour of management systems. I have to say that it is a temptation that every administration cannot resist. If this Government had developed the NHS from where it was in 1997 to where it might be in two or three years' time, the political management would have been credible. Politicians must now swallow their pride and admit that they must step down, with management placed in the hands of a responsible agency—a model much favoured by the Government in other spheres. I know, too, that the noble Lord, Lord Hunt, would feel very denied if not given yet another opportunity to discuss that issue.
	There are huge concerns with many aspects of the Bill, not least the role of the independent or not-so independent regulator, the fanciful governance arrangements, the possibility of eroding the enormous amount of work that has been invested in cross-agency partnerships and the patient's journey, financial systems and the risk of jeopardising vulnerable local health communities with the erosion of strategic health authority powers, the new regulatory bodies, and the loss of opportunities for primary care organisations. My amendments, if carried, will resolve all those concerns at a stroke, so I live in hope.

Lord Alderdice: My Lords, I declare an interest as a consultant psychiatrist working part-time in the National Health Service.
	I listened with interest to the Minister's description of more money, more doctors, more nurses and more procedures, and I do not doubt that what he says is accurate. However, is it not striking that it has not led to higher morale among staff in the health service? I have to say that I do not think that I have known it any worse. To some extent that is not despite there being more money, staff and procedures, but because of it. When there is inadequate funding, a clear paucity of staff and poor figures, there is always the hope that if one can persuade the Government to put in more resources things will improve. So why is it that after the Government have put in more resources and volunteered another major reform of the health service, there has been no improvement in morale or a great resounding welcome for the Government's proposal?
	There are a number of reasons for that. One is that while the principles which the Government lay out seem to be reasonable, their proposals for implementing them seem unclear and self-contradictory. That was mentioned most notably by the noble Baroness, Lady Cumberlege. The current fashion for making two or three contradictory statements in one sentence and proclaiming that by doing so one has made great philosophical and practical progress is seen through by the vast majority of the population.
	Nor is it the case that the population and health service staff are unhappy and dispirited because they have not heard what the Government are saying about their proposals. In fact, the Government's proposals are self-contradictory. For example, the noble Lord, Lord Warner, in his letter to Peers, pointed out that the NHS should become more personal and that there should be greater freedom on locally run services. He stated that local staff and local people have clearer knowledge than Whitehall and that central control should be replaced with local freedoms. I agree with that. But there is an inevitable consequence of devolution; that is, diversity, which the Government say they want to see. They say they want more choice, more opportunities and more capacity for adventuring and experimentation.
	However, that means more differences. It means that circumstances will not be the same in every area and that equality of access is impossible. If in a local area it is possible to decide to put more resources into a particular form of treatment, there will be fewer resources for other kinds of treatment. That may be a perfectly legitimate decision, but it will ensure that the access to particular forms of care in that area will be different from the access in another area where different but totally reasonable choices have been made. When we say to the citizens of this country that we will have diversity and choice, that everyone can have what they want and that it will be available equally to everyone, the citizens look at us askance and say, "You're not being very honest, because that is just not possible".
	The Government also say that decisions will be made locally. They say, "We will put in place many people who can take responsible decisions". However, at the same time we are being told that the standards and regulation will be national. What is more, we are told that they will not be lowest-common-denominator standards; they will be high. Indeed, they will be so high that many people will not reach them. Well, as all the decisions will be made centrally, how will decisions be made at a lower level? The citizens see that, as do health service staff.
	Those members of staff know all about such standards because every time there is a problem an inquiry is set up. If it is any good at all, it produces a whole set of proposals. As the politician who asked for the inquiry is in no professional position to say that although some of the proposals are interesting they will not work, he or she must say, "I accept in total what the inquiry says and we will put all of it into operation". That ensures that there are so many standards, monitoring exercises and committees and so much accountability that no one has much time to see patients. In addition, it is almost inevitable that the standards will be breached because there are so many that it is impossible to fulfil them all. People therefore lose heart, and self-esteem and performance decline. And so does any sense of belief that what is proposed by the Government is likely to be successful.
	That is why I have enormous sympathy—indeed more than that. It is why I support the proposition aired by the noble Baroness, Lady Cumberlege. I believe that it is time for the political masters to step back to a position of determining strategy. They should take high-level decisions, of course, but they should not be involved in the professional micro-management of the NHS. The population does not regard the NHS as the prerogative of any particular party or Government, but as being part of the strength and richness of our whole community in the United Kingdom.
	There is another inconsistency. It is proposed that the best performing trusts are ideal to become foundation trusts. If foundation trusts represent such a wonderful mechanism for improving performance, surely it would be better to make the lowest performers into such trusts. If the scheme were successful, presumably they would raise their standards.
	We in my profession have become familiar with being tutored by the Government in evidence-based medicine; that if we are to prescribe something we need to know that the outcome justifiably can be seen to be possible. Most professionals in the health service would like to see some evidence-based politics; for example, a monitored pilot scheme with an assessed outcome. On the basis of that, the treatment could be made more widely available.
	Why take a particular group of hospitals or trusts, insist that the best performers become foundation trusts and say that everyone else will become so good—so good because they were not foundation trusts—that they will measure up in two or three years' time? That would not pass many research ethics committees; it would not pass many statistics tests; and it would not pass many peer reviews in professional journals.
	What I believe would pass muster is a proposal that all the trusts in a particular area of the country should be able to become foundation trusts. If after four or five years careful monitoring and assessment showed that the poorer trusts had risen to the level of the better trusts and that the better trusts were even better as compared with the "placebo" of the rest remaining under present government policy, the evidence-based politics would persuade those of us who make our judgments on evidence-based medicine that the proposal was worth while.
	Finally, I turn to the issue of money. The noble Earl, Lord Howe, earlier pointed to the inconsistency of maintaining the departmental expenditure limit while insisting that money coming in from the private sector will enrich the health service as a whole. That inconsistency may not be obvious to the citizenry as a whole, which may not be as familiar with departmental expenditure limits as Members of your Lordships' House, but that gaping inconsistency is obvious to those of us here.
	As we try to do the best we can with the Bill, perhaps we can try to encourage the Government to work towards an old-fashioned notion of consistency in thinking and to provide rationality in approach and evidence for what they are doing. Perhaps we can also encourage them to pull back a little and allow the professionals and the patients to get on with the health service and to keep the politics to the strategic decisions at another level.

Baroness Masham of Ilton: My Lords, many organisations have sent out briefing papers and professional bodies are taking a great interest in this Bill, as I do. But one always wonders what an untried idea will produce. I take this opportunity to ask a few questions as some parts of the Bill seem to leave important matters to regulations.
	I declare an interest as founder and life president of the Spinal Injuries Association. I have a great interest in specialist centres of excellence, which are the lifeline of many people with long-term medical conditions.
	In Chapter 2 of the Bill, Clause 44, dealing with quality in healthcare, seems to me to be one of the most important issues that we should discuss. The quality of healthcare should be paramount, be it in a National Health Service body, in a private hospital or in a nursing home. Clause 44 states:
	"It is the duty of each NHS body to put and keep in place arrangements for the purpose of monitoring and improving the quality of health care provided by and for that body.
	(2) In this Part 'health care' means—
	(a) services provided to individuals for or in connection with the prevention, diagnosis or treatment of illness; and
	(b) the promotion and protection of public health".
	Over the years I have served on a variety of health bodies: a community health council, a health region and a family health service authority. All governments seem to like changing the National Health Service, but with so many changes over the past 20 years a great deal of confusion and insecurity has been caused. Trying to remember the different names of the different bodies and what they do is becoming a nightmare. For example, Clause 43 states:
	"(1) The Commission for Health Improvement is abolished.
	(2) The National Care Standards Commission is abolished".
	No sooner is one body set up than it is closed down.
	For various reasons in the past year I have met several consultants and district nurses who all say, "We just want to be able to get on with the jobs we are paid to do rather than being diverted into yet more reorganisation".
	The Royal College of Nursing supports the general intention to improve both the transparency of decision making and the involvement of staff, patients and the public through stakeholder councils. I ask the Minister what is and who will run a stakeholder council? Is it to be yet another body?
	The noble Earl, Lord Howe, will be one who remembers the debates that your Lordships have had on community health councils. We were given assurances that their place would be taken by patient forums, but it seems that foundation hospitals are to be excluded. Can the Minister say whether that is true and, if so, why? If there are not to be patient forums in foundation hospitals, but there are to be in other hospitals, will that not add to the confusion? I hope that there will be patient input in all hospitals. The public need a point of contact for advice and support.
	It would be interesting to hear about the potential liability that falls on an injured person treated by a foundation trust to pay for any treatment given. That could affect many of our future members of the Spinal Injuries Association who may break their backs or necks in road traffic accidents or racing accidents and who remain paralysed. What happens if such a person is not insured?
	There is national concern about the dangerous problem of infections in hospitals. Patients who go into hospital for an operation are at risk of being infected by MRSA and thousands of people die each year from that dangerous contamination. I ask the Minister whether the Commission for Healthcare Audit and Inspection (CHAI) covers the inspection of infection control in hospitals and other healthcare facilities? The problem is now so serious that there needs to be an overview and standards should be put in place to make healthcare safer, especially for vulnerable patients. I feel strongly that there should be a national service framework to incorporate all infectious conditions and to bring hospital cleaning standards up to a high level. If that was done the public might think that the Government were trying to tackle that worrying situation. Nurses, doctors and patients move from hospital to hospital. Infections do not mind if a hospital is called "foundation" or otherwise. Our standards should be national.
	I should be grateful, as I am sure the House would be, if the Minister would give your Lordships an update on specialised commissioning. What is happening about organising, planning and paying for specialised services for conditions such as HIV/AIDS, spinal injuries, complex neurological conditions, neonatal intensive care and many other vital conditions? The resulting delay in the reorganisation of neonatal care is causing desperate problems for mothers and babies transferred long distances because of a lack of cots. The delay in sending someone who is paralysed to a spinal unit can cause all kinds of complications with the risk of serious pressure sores, bowel problems and urinary tract infections which delay rehabilitation and cost extra money.
	Will the Minister tell the House which Bill or Act of Parliament embraces specialised commissioning? Is it this Bill? We need the correct treatments and the highest standards for all patients wherever they are treated. I look forward to the Minister's reply and I wish him a happy birthday.

Lord Hunt of Kings Heath: My Lords, I declare an interest in a number of NHS and NHS-related organisations that I advise listed in the register of interests, including KPMG, Beachcroft Wansbroughs, the Sainsbury Centre for Mental Health and the King's Fund. I am also a member of the advisory board of the Commission for Healthcare Audit and Inspection.
	I welcome the Bill before us and thank my noble friend for the careful way in which he developed the argument in favour of the Bill. There are many important issues, and I particularly welcome the provisions for the dental service. I support the aim of embracing the profession much more into partnership with the NHS and ensuring that dentists feel that working for the NHS is no longer, as they describe it, part of a treadmill but something that they want to do. It is significant that the BDA supports the general thrust of the provisions in the Bill.
	I want to concentrate on what I believe goes to the heart of our debate: foundation trusts. Many fears are being expressed about foundation trusts. It has been said that they will lead to a two-tier service; that this is the slippery road towards privatisation; and it is claimed that foundation trusts may damage the ethos of the National Health Service. If I believed that I would not be standing here today supporting the concept of foundation trusts. I think that foundation trusts are an essential part of the ingredients needed to ensure that the NHS thrives and prospers over the next 10 to 20 years.
	There is no question that the NHS faces a daunting challenge. We all know of the problems that it has faced over many years—the lack of investment and the lack of capacity—and we are starting to see those problems being addressed. The five-year financial investment—the 7.4 per cent per year over a five-year period—is a fantastic investment. By 2008 we will be spending 9.4 per cent of our GDP on health, which is equal to that of the French. That is an extraordinary thing. No one in the health service ever believed that we would receive that kind of investment.
	However, that kind of investment comes with a risk. The risk to the NHS is that it will fail to deliver the kind of first-class quality services that people expect. By the end of that period we would probably be the fourth biggest spender on health per GDP of any country in the world. At last the NHS is receiving the kind of resources that one would expect. The public have had to pay increased taxes through national insurance to pay for it. It is an awesome responsibility on all those in the NHS and in the Department of Health to ensure that people feel that that investment is worthwhile.
	If at the end of that period the public do not feel that that investment has been made wisely we know that many people will start to walk away from the NHS. Therefore, I am convinced that the test facing the service in the next few years is as hard a test as was faced when the NHS first started in 1948.
	Of course part of the test concerns targets. Targets are much maligned in your Lordships' House. There is no question that we have too many targets. However, when one boils the issue down to key targets, such as waiting, I am confident that the health service will achieve the target of a maximum three-month inpatient wait by 2008. But the issue is not just a question of targets, it is really a question of the quality of the service that people receive. Will people receive the choice in the health service that they rightly wish to see? Will they receive an integrated service, so that all parts of it work together? Will people feel that they are at the centre of the treatment programme?
	There must be a question mark about that. The reason for that question mark is that the NHS cannot begin to compare itself with the best healthcare systems in the world or with the best consumer services in this country if it continues to be managed in the way that it has been managed, not since 1997, but actually since 1948. By that I mean the model of a service where Ministers are accountable to Parliament for everything that happens within it. It is that model of accountability that has led us into this problem of micro-management of too many targets and of an NHS at local level that feels put upon rather than feeling it has room to change, to innovate and to improve its services.
	I listened with great care to the remarks of the noble Earl, Lord Howe, about my own legislative tendency. He is right. I cannot remember how many Bills I was responsible for taking through this House which changed the structure of the health service. The House of Commons Select Committee reckons that this Bill is the 18th restructuring of the health service since 1982. That date is very significant because although the noble Earl, Lord Howe, frequently likes to present himself as a decentraliser, the fact is that his own party when in government was as fond of tinkering and changing the structure as any government have been.
	The point is that so long as Ministers are accountable for everything that happens in every part of the NHS, I believe that governments of whatever shade will continue to tinker and to restructure and reform.
	So we have to move to a situation where the temptation and the pressure are not there. I do not go down the route of the noble Baroness, Lady Cumberlege, because I do not think that one can completely divorce the NHS from politics. Politicians do have to make judgments about national standards. They do have to make judgments about resources. But I think that when they have done that—and now we have an independent inspector to make sure that what Government have set out in those national standards is delivered—one has much more freedom then to allow local NHS organisations to work within those national standards.
	Furthermore, I disagree with the noble Lord, Lord Alderdice, on that issue. I think that within those national standards there is considerable room for discretion. But, having set those national standards, I think that it is possible to give much greater organisational freedom to those organisations which work at local level in the NHS.
	That is why I strongly support the concept of foundation trusts. The membership base they are given through an elected board of governors is the means by which accountability can be transferred from national politicians to local people. I very much hope that this House will support these very important principles.
	We shall be debating a number of the issues and details around foundation trusts. There are issues in relation to governance that need to be teased out. First, it is very important not to think that only acute trusts will become foundation trusts. There is every reason for other trusts—mental health trusts in particular—to be considered in the front rank of NHS organisations. I am disappointed that much of the debate has been around acute trusts.
	Secondly, I believe that there should be continuity of leadership. I know that the guidance states that the chairman and chief executives of a potential foundation trust can follow through into a position in a new foundation trust, but there is nothing in the Bill that says that that may happen. My reading of it is that on 31st March the NHS trust will be wound up; on 1st April the foundation trust will come into being. It is up to the governing body to decide who should be the chairman and the non-executives and that it is for them then to appoint the chief executive and the executive directors.
	I am very keen that the governing body has power in this new structure. But, surely, given that the whole basis of foundation trusts in the first wave is that they are the strongest organisations, it would be folly for the current leadership of those organisations not to be automatically transferred lock, stock and barrel to become the board of directors. I hope that we can have some assurance from my noble friend that that can happen and that if necessary he will table government amendments to make sure it does.
	I have two other points on governance. One is that it also ought to be consistent with the Higgs report on the role of boards and non-executive directors. There are many chairmen of NHS trusts who are concerned that the guidance issued by the department is inconsistent with the Higgs report. If so, I think that would be a great pity.
	I end with one key question for my noble friend. Will he ensure that he and his colleagues in the Department of Health will make these arrangements work? When a problem hits a new foundation trust—a problem which perhaps attracts national attention—it would be too easy for Ministers to rush in and insist that the trust takes certain action, through strategic health authorities and primary care trusts.
	The health service will be watching. If it sees very early intervention in the affairs of a foundation trust, it will conclude that this is not for real. I say to my noble friend that an early test of these new arrangements will come into play.
	I hope that the ministerial team will pass that test because if the NHS concludes that this is not for real, then we shall lose the great potential that we have for changing these arrangements and for giving people at local level far more power over their own destiny in the NHS. In addition, in a year or two we shall be sitting here debating another NHS Bill—the 19th restructuring since 1982—and it will have been a waste. Ultimately, this is a very well-intentioned Bill and it is essential that the principles are allowed to happen in practice.

Viscount Bridgeman: My Lords, I must first offer my apologies to your Lordships, and to the Minister in particular, for not being present in the Chamber today for the first two speeches and part of the third. My car was incapacitated on the motorway for an hour and a quarter. I am aware that the conventions of this House, strictly interpreted, suggest that speakers in my position should withdraw. I am on this occasion asking for your Lordships' indulgence if I make a speech which will be more brief than I had originally intended.
	Perhaps I may also say what a privilege it is to follow the noble Lord, Lord Hunt of Kings Heath. I am sure that I speak for many of your Lordships when I say how greatly his vast experience in health matters, both in government and elsewhere, is valued, as it was in the admirable and thoughtful discourse on the broad picture of the health service which he has just given us.
	I declare an interest as chairman of an independent hospital in central London, which has a closer relationship with the NHS than many of its peers in the independent sector through our hospice, which is part of the hospital, and through a number of NHS surgical lists which we are undertaking under the terms of the concordat to the mutual benefit, I hope, of both bodies.
	We in the independent sector welcome the bringing together of the regulation of the independent and NHS sectors. At the time of the inception of the old CHI and the NCSC, regulating the independent and private sectors respectively, I, like many others, was at a loss to understand why two separate regulating bodies were required. I can only suggest that it was down to the very different political approach to the interplay of the public and independent sectors by the then Secretary of State, to which the present Secretary of State and his immediate predecessor provide, in my view, a very welcome contrast in their approach.
	But that was the system and it threw up a number of anomalies which, I suggest, on the whole discriminated against the private sector hospitals. Perhaps I may give two examples. To date, it has been a requirement for all staff in independent hospitals to have full Criminal Records Bureau disclosure. The vast majority of NHS staff do not have that requirement. Another example is that the NCSC has laid down stringent minimum quality standards for the private sector, while CHI stipulates only broad principles of clinical governance. There is a big difference there.
	So, to bring the regulation under one body is to be welcomed so far as it goes. But the Bill does not provide a timescale for the inception of the new CHAI. Therefore, we wish to see CHAI announce the date for implementation of a common set of standards. I should like to suggest to the Minister that a suitable opportunity might present itself in that those standards could be trialled in the new diagnostic treatment centres ahead of being rolled out nation-wide.
	I have another serious concern. I have already referred to the absence of a timescale. Indeed, there are indications that for the time being CHAI intends to keep the two sectors apart. I should welcome an assurance from the Minister that either in the Bill or by statutory instrument there will be a fixed time for the total amalgamation of CHAI taking over the regulatory role for both sectors.
	There is an additional reason for that. Independent hospitals are caring for an increasing number of NHS patients under the concordat, and consultants frequently work in both sectors. A common approach to inspection would be sensible, leading to greater simplicity for the patient and clarity for both NHS trusts and independent hospitals.
	Perhaps I may make a further point concerning the division of the functions of CSCI and CHAI. With such reservations as I have mentioned, I welcome the creation of those two bodies but it is vitally important that the division of responsibility between the two is sensibly and practically worked out. The noble Lord, Lord Clement-Jones, for whose speech I arrived in time, made that point.
	The division of responsibility is set out in Clause 100 of the Bill, but there is one anomaly in particular to which I want to draw the Minister's attention. I understand that long-term conditions—for example, acquired brain injuries—and time-limited (that is, up to six weeks) substance and addictive behaviour treatment in respect of, for example, drug and alcohol addictions will be regulated by CSCI and not by CHAI. The reason is, I understand, largely one of precedent in that in many cases those treatments are provided by units currently registered under NCSC.
	Therefore, now that the Bill has arrived in your Lordships' House, I urge the Minster to reconsider that distinction. Brain injury and drug treatment centres have much more in common with "mainstream" healthcare than with "mainstream" social care. They need to be regulated by people who understand doctors and nurses and not by people whose main expertise lies in regulating social and community care.
	I shall want to return to that matter in Committee but, in the mean time, perhaps I may suggest to the Minister that this problem could be addressed by simply reclassifying those units as "clinics", thus bringing them within the responsibilities of CHAI under Clause 100(2)(b) of the Bill.
	To sum up, we, like many hospitals in the private sector, welcome the creation of the two bodies but this bold move should not be impaired because the borderline between the two has between insufficiently thought through. I have no doubt that we shall return to this point in Committee.

Baroness Pitkeathley: My Lords, I thank the Minister for his forceful introduction and look forward to working with him and other colleagues in your Lordships' House on the content of this major and significant Bill.
	Your Lordships will know that in the many debates we have had in this House on these important issues my two main concerns have been the relationship between health and social care and the issue of patient representation and involvement. It is on those two aspects that I want to concentrate in my brief speech today.
	It is precisely because of my interest in these two aspects that I have followed with some resentment what I might call the "hi-jacking" of the Bill by the foundation hospitals issue. I resent that for two reasons. The first is that it has allowed too many people to think that the NHS and NHS reform are all about hospitals. They are not, and I am especially resentful that this has happened at a time when we have made so much progress through the establishment of primary care trusts, and so on, in understanding that, for most people, healthcare begins and ends at their GP and at the primary care level. The Government have shown their commitment to that by ensuring that in future 75 per cent of the funding will be decided at that level.
	The second reason that I feel this resentment is because the publicity about foundation hospitals has drawn attention away from the other important aspects of the Bill—the patient and public involvement arrangements and the setting and regulating of standards in social care.
	I shall say only one more thing about foundation hospitals and that is that they are linked with the Government's undoubtedly strong commitment to patient and public involvement. As I understand it, there is currently no provision for patients forums in foundation hospitals. This is a serious omission, even taking into account that patients and their representatives will be in the majority on the boards of the foundation trusts. I hope that we can make appropriate changes as the Bill proceeds through your Lordships' House to ensure that patient participation and involvement is given the importance to which I know the Government are committed. It may well be possible, for example, to ensure that foundation trusts involve patients through primary care trusts or in some other way. But we must be assured that that commitment to patient and public involvement, which has been so hard won, is not compromised.
	I turn now to the social care aspects of the Bill, and I am especially concerned with the parts where health and social care aspects overlap. As we know, the Bill establishes a new Commission for Healthcare Audit and Inspection to inspect and raise standards in healthcare. I particularly welcome the fact that it will establish standards of care for every private sector hospital also. The new inspectorate will merge into a single organisation the health functions of CHI, the National Care Standards Commission and the Audit Commission. Leaving aside the unfortunate matter of the creation, and then the almost immediate amalgamation of the National Care Standards Commission, the creation of new CHAI is sensible. I pay tribute to the staff and board of the NCSC, under the peerless leadership of Anne Parker, for the far-sighted and flexible way in which they have approached what could have been an extremely difficult situation.
	I believe that CHAI will encourage improvement in the quality and effectiveness of care. I would welcome confirmation from the Minister as to whether its remit, as well as including private care sector provision, will extend to regulation of the newly developing diagnostic and treatment centres. I declare an interest as a member of the Clinical Advisory Board of Inventures, which is making great progress in setting up such centres.
	The Bill makes another very important change so far as concerns social care: it establishes a sister organisation, the Commission for Social Care Inspection, to do a similar job in social services, or rather social care, to guarantee standards of care for some of the most vulnerable people in our society—we have been forcefully reminded of that today by the publication of the Green Paper—who, for far too long, have been at the bottom of the pecking order for these services. It will be for both commissions to work together to bridge that divide, which has beleaguered our services for so long. They must ensure that health and social care do not compete with each other but work together. I am sure that this will be a priority for the most able new chair of the commission. Patients and carers constantly remind us that they do not understand the divisions between health and social care—why on earth should they? We must ensure that the arrangements are inclusive, not divisive.
	I wonder about the position of the General Social Care Council with regard to the new arrangements. Noble Lords will not be surprised to hear my concern, as I chaired the group that advised on its establishment and was its interim chair for six months when it was first set up. The GSCC is doing excellent work on the regulation of all workers in the social care field, as well as their training, and is to be congratulated on publishing its codes of conduct and on beginning successfully the huge task of registering the million-strong social care workforce.
	However, both the GSCC and the Social Care Institute for Excellence were established in different circumstances from those that now exist. It would not be surprising if there were some confusion about what is expected of the GSCC now in relation to the new commissions. The GSCC has enjoyed a direct and always productive relationship with the Department of Health. I hope that the Minister will make it clear that that is expected to continue.
	It is my earnest hope, in relation not only to the GSCC but to the whole issue of social care, that the transfer of so many expert staff from the Department of Health to the commission, and indeed the loss of so many staff from the Department of Health itself, does not represent any downgrading of social care from the political agenda after so many of us have fought so hard and for so long to give it its proper and much-needed level of importance.
	I remember very well how it was good relationships between the carers' organisations, civil servants and Ministers that played such an important role in enabling the huge progress that has been made in the recognition and support of carers to take place. We all worked together, not to oppose or outwit each other, but in a spirit of genuine co-operation and commitment to the client group. It is vital that the professional skill and expertise in social care that exists is not only maintained but allowed to develop. I hope that the Minister will reaffirm his own commitment to making social care just as important in his brief as healthcare. We are fortunate to have a Minister such as my noble friend, who is so experienced in this field, and we must ensure that recipients of social care and their carers benefit from his knowledge not only of needs but of delivery.
	I look forward to working with noble Lords on ensuring the best possible outcomes for patients, carers and their families across the broad range of issues covered in the Bill.

Baroness Greengross: My Lords, I welcome much of the Bill and the intentions that have led to its introduction. I am grateful to the Minister for outlining the wide impact that it will have. I declare an interest as the vice-president of Age Concern England and a patron of the Local Government Association, Action on Elder Abuse and the Family Planning Association. I am also involved with many other bodies that have sent us helpful briefings. I wish to make some brief comments but mostly to ask questions on several aspects of the Bill. I shall be brief.
	I am certainly not against trying new types of NHS organisation. With regard to foundation hospitals, the obvious good news about local accountability must be tempered by the need to sort out that accountability. If we are not careful, there may be accountability to everyone in principle but no one in reality. There is certainly a conflict between the principle of earned autonomy and local accountability, which is inherent in the idea of foundation hospitals.
	I have a question about the impact on the National Service Framework, which is very important—for example, the framework on older people and that on mental health. Can we be certain that the standards and service models will rigorously be applied by foundation hospitals?
	With regard to flexibility, which is very important in foundation hospitals, there is a question about those patients who might be more expensive than average. Such patients are quite likely to be older people because they take longer to recover and therefore might cost the hospital more than the original budget. To overcome that, should the duties in Clause 38, which are about effectively, efficiently and economically working, include "equitably" or "fairly"? Would that be a way of ensuring that this could happen?
	We also need to look closely at the impact on mental health trusts and mental health in general—they must not be second-rate aspects of foundation hospital practice.
	On care standards, I am an enthusiast for clearer regulation and inspection. It is long overdue to raise standards across the sector. As has been said, the work of the National Care Standards Commission shows what can be done despite the challenges. I received an excellent annual report from the commission today. I congratulate Anne Parker and my noble friend Lady Howarth, who has carried out fantastic work in that respect.
	Health and social care regulations and inspection must be brought much closer together so I welcome the introduction of CHAI and CSCI. But I have some concerns and questions. I agree with Help the Aged that CSCI should conduct research, as recommended by the Royal Commission on Long-Term Care of the Elderly, because we need to ensure that demographic changes are taken into account, as highlighted by the International Longevity Centre UK, which I am privileged to chair. We must ensure that new services are developed, for example, to meet capacity and provision needs.
	I hope that CSCI will also protect older people who are self-funding in care homes. In effect, they often subsidise the local authorities, which should not continue. Above all, CHAI and CSCI must promote the rights of all users—both rights to services and their human rights. That applies particularly to older people, especially as two thirds of hospital in-patients and 50 per cent of social service users are older people.
	The statutory rights of children are now more detailed and clear, as evidenced by today's Statement on children. Of course I welcome that, but we need some similar joined-up thinking about older people and those who are particularly vulnerable—for example, those in need of mental health services. That aspect needs to be balanced.
	I welcome the inclusion in Part 4 of the Bill work on dental and GP services. Dentistry is a very important and long-neglected part of the NHS. For example, I was here in the Palace early one morning talking to two female members of staff, one of whom was going to have all her teeth extracted because she had no hope of gaining access to NHS dental care in the part of London where she lived, which was not far from here. The other one had given up as well. That is absolutely terrible and something that needs our attention.
	It is sensible to commission services locally. I hope it works but I am concerned about how we will improve the provision of dental treatment if we do not define in Clause 166 what "reasonable" means. I assume that we will do so in the course of our proceedings.
	I also welcome the regulation of private dentistry by CHAI, and the agreement with GPs over their contracts in Clause 171. However, I am worried about one thing: how can GPs' practices meet needs that seem to conflict? How will the need to have advance appointments—which disabled and old people need because any transport arrangements must be fixed—tie in with surgeries being available on a walk-in basis, allowing for quick access to GPs whoever we are? Overall, however, I support the Bill and I look forward to the Committee stage.

Lord Desai: My Lords, I have no interest to declare because I have never been involved in any part of of the NHS, except as a patient. By the time I have finished, people may say that it is a good thing that I am not involved. I welcome the Bill, but I would have preferred the original version that was introduced in the other place. However, even that did not quite answer the problems of the NHS.
	My noble friend Lord Hunt made a very radical speech. To have been a Minister is a healthy thing. Ex-ministers are very radical people and the more ex-ministers that there are in the world the better the world will be. I agree with part of his analysis. Any system in which the Secretary of State in charge is said to be responsible for everything that happens in the health service—such as in the great bed pan debate of Nye Bevan—is bound to depress everybody who is not thought to be responsible for the health service. We must drastically de-politicise the health service.
	Had this debate taken place three months ago, I would have said that the NHS ought to be autonomous, like the BBC, but that issue has become a no-go area so I will not say that. However, if the Secretary of State runs the health service, in response to every headline in a red top newspaper, we are bound to have the announcement of an initiative or another monitoring group. Every time there is a sudden death, it is a political problem that must be dealt with by the Secretary of State.
	We are all very proud of the National Health Service, but we always say, as the noble Lord, Lord Alderdice, said, that morale has never been lower. For the past 38 years that I have lived in this country, morale in the NHS has never been lower. I do not know how low it will get, but no matter what we do, morale has never been lower. It is because the people involved are not in control of their workplace. They are not in control of what they do. Morale will be low, especially when dedicated professionals who spend much of their lives acquiring their skills are not in control of what they produce.
	There is a great problem associated with this. There is a confusion in political philosophy that haunts education as well as health—people think that universality and equality means uniformity. Everybody thinks that if it is not uniform it is two-tier and unequal. That is such a deep fallacy and I do not have time in the next three or four minutes to deal with it. However, if society is unequal, for various reasons, we need unequal access to overcome inequalities. However, if we have a rationed system—and it is a rationed system, let us not beat about the bush: it has to be—it cannot deal with people's unequal endowment, needs and health problems. It will deal with them equally. Therefore, the outcomes will be unequal because we are not dealing with equal needs in an equal fashion.
	It is no surprise that, after 48 years—no, more than that, for 55 years—we still have inequality in health outcomes. We do not allocate food in such a way, nor water, nor transport, but we allocate health in that way and we are stuck. No political party dares tackle the problem. We must de-politicise and decentralise the problem.
	I welcome the Bill because it makes another attempt to decentralise health. I say another attempt, because there was an internal market and we now have the de-politicisation. As some noble Lords may know, I am associated with the Health Policy Reform Group. Nobody ever takes the slightest notice of what we say, but it is still worth saying. I prefer a much more radical proposal. Hospitals should be owned by the people who work in them and the local community. A lock is put on their assets—so that assets cannot be used for anything other than healthcare. We could even say that the assets are owned by the state but could be leased to the local community which could then manage them. I see no problem in allowing them to borrow from wherever they want. I fail to see why the Treasury stepped in. It is remarkable how it has always stepped in over the past 100 years and messed up a perfectly straightforward arrangement, in the interests, it would say, of equity.
	If borrowing is only on public account we cannot help but create anomalies. My only hope is that, as many people have said, there will be other Bills because this Bill will not solve everything. In future Bills, we may realise that all hospitals, not only foundation trust hospitals, should be locally owned and run with full freedom to borrow from wherever they want. After all, the people who will lend them money are not stupid. They will see that hospitals will be given money only in a rational way. Nobody will let a hospital run away with a big debt, because we know that hospitals are not a money-making enterprise. Several not-for-profit organisations can borrow and there is no reason why hospitals should not do the same.
	By clinging to a certain notion of equality, which has not created equality for the past 55 years, we are preventing a very good set of professionals from achieving the best that they could. It is not their problem that they are depressed. It is because we politicians have not agreed to give up our power. Whenever it comes to giving up powers, people say, "My God!, We are betraying Clem Atlee and Nye Bevan", or whatever. Those ghosts still haunt us. We are not willing to admit that if the service is not achieving what it ought, there must be something wrong with the way in which it is organised. We should de-politicise, de-centralise and give lots of freedom to people to do what they are dying to do, which is to provide good healthcare. I hope that we will pass the Bill. In it and in future Bills, we should remove more of the constraints on good professionals, and we may yet achieve a modicum of the equality in access and outcome that we have waited for for 55 years.

Baroness Hanham: My Lords, I start by declaring an interest as chairman of a three-star National Health Service trust that is on the verge of considering the implications of assuming or applying for foundation status.
	If we decide to go ahead, we will be applying as a second-wave trust, following those who currently have to make applications against the uncertain background of a situation in which the legislation has not completed its parliamentary progress. Had the original concept put forward by Alan Milburn—my noble friend Lord Howe referred to it—amid proud declarations about foundation hospitals, independent of the National Health Service, free to run their affairs in their own way and free to borrow capital and make full use of their assets been pursued, there would have been a great deal of enthusiasm among NHS trusts to go forward quickly and energetically. However, the proposals in the Bill are the timorous offspring of aggressive parents and have paled, over time, into more mundane reality. We have heard much about that today, and I do not propose to take the matter much further, except to say that here is an opportunity to galvanise the health service. One wonders whether the upheavals that will come about because of the Bill, if it is passed in this form, will ever be considered to have been justified.
	I make no apology for the fact that I want to talk about the new governance arrangements of foundation hospitals. I will mainly direct my remarks to that issue. In particular, I want to talk about the board of governors that will sit above the trust board or management group. Its task will be, apparently, to develop the vision for the foundation trust, represent it to the community and the outside world and appoint and fire the chairman and chief executive, as appropriate, of the management board.
	The management board is to be constituted along the lines of the current trust board, we believe, and is to have the responsibility of running the hospital. It is not clear whether it is expected that the currently constituted boards will survive to run the National Health Service while those changes take place. I speak now with less confidence, having listened to the noble Lord, Lord Hunt of Kings Heath, but I assume that it makes sense that that will be so and that they will translate through the reorganisation. I assume that non-executive members will be kept in place for at least the duration of their appointed term. That is the first question that we must address to the Minister: will they?
	The second question is, "What, apart from that which I have already outlined, is the board of governors going to do, and how will it relate to the management board and the decisions that the board must make on a day-to-day and strategic basis?". The composition set out in Schedule 1 does not suggest that either the chief executive of the trust board or its chairman is to be one of the number of the board of governors. What will be the links between those two bodies? Will the board of governors have the right to intervene and/or override decisions and policies being developed by the management board? Who will service the board of governors? Will there be extra resources to set up a separate office and administrative structures, even if, as I imagine, the board will be able to ask for information from the executive team of the trust? What happens if there is a disagreement between the two boards? Which has the final voice?
	The size of the board of governors is to be decided initially by the putative foundation trust. Aside from some appointed members, there will be a representative of the local PCT. Which PCT? Particularly in metropolitan areas, there will be a number of PCTs that would be entitled to sit on the board. My trust alone has 48 commissioning PCTs, and others will have far more. There will be members of the local authority. Which local authority? A number of foundation trusts will straddle more than one local authority area. The board will have to include two elements of elected representatives—the public and the staff. The constituencies for their elections will be their "stakeholders", who will, respectively, be those who live in the local community—how will that be defined?—and/or have been patients or carers in the hospital and the hospital staff. In each case, it will be only those who have paid £1 to the trust to be registered who will be part of the corporate body and thus able to vote.
	Here is where the fun begins. Who will run the elections? Who will collect the £1 postal orders and coins? Who will keep up a rolling register? I know the answer: it will be the foundation trust. However, it will require staff to administer it properly and fairly—more resources. Also, who will run the elections? No doubt, it will be the foundation trust. It has no experience of being an electoral reform society. In any event, should it not be using its resources to look after the patients? Can the Minister give us a few thoughts on the administration and organisation of such things?
	I will turn for a moment to the public constituency. For what will aspiring candidates stand? Will it be as representatives of the community in general or as representatives of particular aspects of the service—kidney, heart, diabetes, children, cancer or the elderly? What knowledge or experience will they have to have? Will anybody be allowed to put themselves forward, without scrutiny by any independent body? Does not the Minister see a danger that the only people who will be elected will be those who are members of an active organisation—perhaps a lobby or special interest group—that has the muscle and organisation to give its candidates support in the election? Just with reference to that, what role, if any, will be allotted to the National Health Service Appointments Commission, both in respect of the members of the board of governors, its chairman—the guidance, at present, says that anyone from the public constituency can put themselves forward for chair—and the chairman and non-executive directors of the foundation trust, who are, apparently, to be appointed by the board of governors? That is an extremely cumbersome way of trying to ensure that the locality is involved in the trust. It follows on the arrangements that are well in hand now for patient representatives in specialist service areas, for co-ordination with the PCTs in the development of local plans and the strategic part to be played by the strategic health authorities, which will still have a role to play in ensuring that foundation trusts perform for their local communities and that there is a spread of services suitable to their needs.
	Under these arrangements, the governors of the National Health Service will encompass the Secretary of State, the regulator, strategic health authorities, boards of governors, management groups, National Health Service bodies, primary care trusts and patients forums. That structure is to administer the National Health Service for patients. That is folly upon folly.
	The National Health Service is still grappling with the seismic reorganisation of the creation of the strategic health authority and PCT structure. PCTs are still labouring with the problems of balancing their budgets between responsibilities for maintaining the acute and tertiary hospital services in their areas and developing the requirements of care in their community. Those decisions will, depending on resources, potentially leave one or other or both aspects unsatisfied and poorly developed. Soon they will begin the task of working within national tariffs and the competitive edge which surely they will bring to service provision.
	Briefly, I shall touch on the power to borrow which the foundation trusts will have. If ever there was a missed opportunity this is it. As set out now, borrowing arrangements will be severely constrained both by the regulator and the financial repayment arrangements. It is abundantly clear that there will be no extra resources for any foundation trust which has to repay capital and interest. That will have to come from the PCT's budget in its local community because it will have to come as part of the support service and support resource. It is a missed opportunity to allow foundation trusts to have the freedom of flexibilities which had been promised.
	This is a maelstrom into which the Government are bouncing foundation trusts. I look forward to taking part to resolve, if nothing else, sensible governance arrangements which will do what we all want; namely, to involve and ensure that patients have a role in their care but which do not lumber the health service with a situation and an administration which it is impossible to manage.

Baroness Finlay of Llandaff: My Lords, this complex Bill deals with many diverse and yet interrelated changes straddling both England and Wales. The NHS seems to be about change. No sooner does one system come in and bed down than it goes out again and another system is introduced. With my declared interest as a practising NHS clinician, I think "here we go again". In the Explanatory Notes, the differences between England and the devolved health service in Wales are highlighted. I should like to thank the Government for the helpful table that summarises the application of the Bill to Wales.
	In a world where evidence-based medicine is increasingly called for and the National Institute for Clinical Effectiveness is driving decision making, why do we not have evidence-based management changes? In England, the governing of hospitals, as they become foundation trusts, entails huge changes. The debates and amendments to this Bill will be complex. But at this stage I simply question: why has there been no pilot? Why have these governing arrangements not been evaluated? Why are the regulator's roles not clearly defined? How will the regulator function in relation to strategic health authorities and others? If a change in care delivery is to be introduced, should it not be evaluated? Can the service management cope with another upheaval or would stability be better maintained by a phased introduction of new structures?
	A natural experiment will occur as foundation trusts are not being introduced in Wales. I appreciate the Minister's reassurance that Welsh patients will not be disadvantaged when needing treatment in England. It was a pleasure to hear the noble Baroness, Lady Cumberlege, and the noble Lord, Lord Hunt of Kings Heath, outline the clear reasons to distance the service of clinical care from the management hand of Whitehall and the over-involvement of Ministers in the minutiae of the service.
	Yet the introduction of foundation trusts appears to provide a something and nothing approach. The professionals want to get on with looking after patients and do not see their fears allayed. Their reservations will not be answered by theory because they are people used to evidence, who want to see evidence-based management changes. Part 2 deals with standards and the implementation of evidence-based therapies. I seek assurance from the Minister that systems will be in place to track all NICE guidance on medical devices, as well as on pharmaceutical interventions, particularly as new devices may be cost saving in the long term with increased efficacy resulting in decreased on-going prescribing for specific groups of patients.
	The ability of the Commission for Healthcare Audit and Inspection to work across all areas of healthcare is a welcome safeguard for patients. It is long overdue. Consistency is needed in the way in which anonymised data are recorded and handled so that meaningful comparisons can be made and disease outcomes accurately classified and monitored. Unfortunately, the commission's name does not help the organisation to be viewed by clinicians as one that gives constructive feedback to encourage standards to rise and encourage managers and clinicians to be open.
	The proposal to link complaints and compensation is fraught with dangers. The Kennedy report on Bristol clearly recommended a move from a blame culture to a spirit of openness, learning from near-miss episodes. The proposals will deter openness and encourage the vexatious complainant within an increasingly litigious culture. Linking complaints to compensation is divisive as blame is apportioned. Yet, when things go wrong, it is often a system failure and not an individual. The motive for a complaint is usually to get information, to receive an apology and to prevent the same thing happening to someone else.
	Healthcare is not risk free. Negligence must be differentiated from inconvenience and complications of the clinical disorder from avoidable harm. When someone has been harmed they need a proper independent assessment by a professional with appropriate skills and to then receive appropriate just compensation from the NHS pot. However, the current proposals may mean that if a person is vexatious and has the wit to remain unhappy, he or she could get richer. The complainant who receives money feels vindicated and a precedent is set, resulting in spiralling amounts paid.
	For all the proposed changes, it is worth remembering that patients want to emerge from the service feeling better. Professional staff want to add years to life and life to years. Patients are vulnerable when ill. Choices are difficult. Often patients have no choice because they are so vulnerable. They want to know that they are diagnosed accurately wherever they are and are offered the best and most appropriate care and treatment for them. Common things occur commonly, but people die because no one thought of the unusual. All change, whatever it is, must ensure that patients and best evidence are brought together in treatment and care strategies. Management structures must support the process to detect the unusual, to research improvements and to ensure that the lessons learnt are disseminated by education and training. Without the fundamentals of research, education and training, clinical care can never improve. Whatever management changes there are, they must not detract and distract us from that.

Lord Harris of Haringey: My Lords, in general I welcome the Bill. In doing so, I declare an interest as a non-executive director of the London Ambulance Service NHS Trust and as yet another senior associate of the King's Fund to speak today.
	Parts 3 and 4 have not attracted much controversy. They are sensible and long overdue. NHS costs should be recovered when personal injury compensation is paid. It is an anomaly that this has not been the case, except in road traffic accidents. The changes to GPs' contracts, now widely supported by GPs themselves, and parallel changes for dentists enable and encourage a variety of work patterns, but also focus on the range of services delivered by a particular practice rather than an individual practitioner. That, too, is very sensible.
	Likewise, Part 2 is based on good and proper principles. In this case, the audit and inspection regimes covering health and social care should be rationalised and made more coherent. This has meant that in a number of cases institutions that started operating only last year are now being reorganised and merged. It is perhaps unfortunate that the desire to be cohesive could not have been acted on when they were established.
	It makes no sense for the NHS and private health care to be regulated separately, as is the case at present. That leads to confusion, complexity and irregularities. Potentially, it is a significant barrier to increasing patient choice. There is little logic in saying, as is the case under the current regime, that the private wings of NHS hospitals are to be regulated by CHI and not the NCSC, despite treating the same patients as any other private hospital, and for independently run diagnostic and treatment centres to be regulated by the NCSC and not CHI, despite treating NHS patients.
	At the moment, the NCSC lays down minimum quality standards for the private sector while CHI stipulates only the broad principles of clinical governance for the NHS. Presumably the intention behind the Bill is for new CHAI to take us towards a level playing field with a read-across between standards set in the NHS and those in the independent sector. Having said that, it is not made clear in the Bill when it is expected that both sectors will operate from a common set of standards and how those standards will be drawn up. I hope that, when he winds up the debate, my noble friend on the Front Bench will be able to clarify that point.
	I should like to devote the remainder of my remarks to Part 1. The issue of foundation hospitals has generated the most vigorous and lively debate in another place. Two major concerns have been voiced. The first is that foundation hospitals will lead inexorably to a two-tier service and the second is that foundation hospitals are privatisation by another name. Certainly the first of those concerns might have been valid for the proposals as they were originally framed, but it is difficult to see how either concern can be justified given what is before noble Lords today.
	All NHS trusts will now have the opportunity—indeed, they will be encouraged—to become NHS foundation trusts. What is more, they will have a legal duty to work in co-operation with other NHS organisations. They will be policed by the regulator and inspected by the new CHAI. If, in due course, all trusts are to become foundation trusts, it is difficult to see how the two-tier argument can be sustained, and it must make sense to allow the trusts that are in the best state organisationally and clinically to make the transition first. This may not have been the concept originally floated, but it is certainly what is before us today.
	Similarly, the privatisation argument seems rather weak. Foundation trusts will be required to use their assets to promote their primary purpose of providing NHS services to NHS patients. Clause 15 provides a lock on the ability of a foundation trust to raise a higher proportion of its revenue from private charges than it would have done as an old-style NHS trust. Indeed, it might be argued that the restrictions are almost too much of a straitjacket in terms of enabling managers to find innovative ways of raising resources to improve the generality of their services.
	If, as I would argue, fears about foundation hospitals are not likely to be realised, what are the benefits for patients of yet another NHS reorganisation? The Minister has in effect advanced two benefits. First, the new foundation trusts will be better able to innovate and to deliver services more in tune with local needs. Secondly, the Government's arrangements will enhance local accountability and service responsiveness to patients. My noble friend said that foundation trusts will have the freedom to gear their services more closely to the needs of their local communities and that this—in what I have to say is a rather unspecified way—will improve services in poorer areas and tackle health inequalities. Further, foundation trusts will be at the cutting edge of the Government's commitment to the devolution and decentralisation of public services, with local staff and managers having more freedom to innovate for the benefit of local communities.
	I am all for this freedom, and if that is genuinely going to be the case, that alone merits the costs and dislocation of this latest change in the structure of the NHS. However, I am sure it would assist noble Lords if my noble friend was more explicit about how this is to happen. What will be devolved and in what areas will Ministers now resist the terrible tendency of Richmond House to micro-manage? How exactly will this reduce health inequalities and improve services in poorer areas? The best way to do that is normally to target additional resources at the areas most in need—and I am conscious that this Government have injected more money into the NHS than any of their predecessors. But is it going to be targeted? If that is implicit in Part 1, then I am sure that I would welcome it.
	I say to my noble friend that this is an important issue. I understand that many NHS managers are excited at the prospect of being able to deliver services more flexibly and innovatively under foundation status, yet what are the extra areas of freedom, aside from the ability to access capital, which of course will mean that they must find additional revenues without falling foul of Clause 15? This is not immediately apparent on the face of the Bill and if those flexibilities could be delivered without legislation, I must ask why we do not do it tomorrow for all trusts, and let a thousand flowers bloom.
	I conclude with a few words on governance. I have long believed in enhancing local accountability and democratic control within the NHS. However, I wonder whether the proposals in this Bill have got it quite right. I would rather more time were spent on getting the governance arrangements right, and if it were possible to proceed with the rest of the Bill but to allow a few more months to work out the precise mechanisms by which NHS bodies would be much more directly accountable to the communities they serve, I am sure that would be desirable.
	Indeed, I believe that a fundamental question must be answered first: why is the emphasis on membership and boards of governors applied to provider trusts—in particular hospitals—rather than to the bodies charged with commissioning, in particular the PCTs? Is there not a serious danger that the new governance arrangements will reinforce, if not fossilise, the traditional provider domination of the NHS, when what we should be encouraging in a modern health service is a more flexible approach to how services are delivered, led by local needs determined by commissioning bodies devoted to improving public health and reducing inequalities in outcomes?
	Schedule 1 defines membership of a "public benefit corporation", but it begs more questions than it answers. The members are to be people living in the area specified in the trust's constitution, but how big is that area? At one meeting I attended, the former Secretary of State suggested that perhaps it should encompass the local authority area in which the trust is situated. I declare an interest in that I live in a London borough in which there is no general hospital, so the questions raised by my noble friend Lady Gould of Potternewton, now sitting on the Woolsack, are absolutely pertinent. How are the areas to be determined? How large or small can they be? I presume that they could not be so small as to create NHS rotten boroughs reminiscent of the other place before the Great Reform Act 1832. Will the regulators seek to ensure that every citizen is covered in some way? Further, the cost of maintaining such a register will not be insubstantial. In many parts of London the electoral register turns over at a rate of 30 per cent per annum. Then there is the problem of the distortions created by people reluctant to subscribe a pound, or erroneously fearful that such a subscription will bring with it potentially heavy liabilities.
	I turn now to the patients' constituency. What constitutes a patient? Again, I declare an interest in that I was born—admittedly almost 50 years ago—in University College Hospital in London. Why should I not be a member of that foundation trust if and when it is set up? Or why not a member of the hospital in which I had my hernia operation some two-and-a-half years ago? I had never been to that hospital before and do not intend to return to it in the future. Or why not the hospital where I spent a few happy hours in A&E with my son? What exactly are the boundaries? No doubt there will be variations. Will they induce confidence in the governance structure?
	A trust's constitution can set other restrictions on who can or cannot be a member. Are there limits to those? Could a trust specify that only people of a certain religion could be members, or only those who are freemasons, or members of a particular political party? It is left to the whim of the regulator as to whether that would be possible.
	The members, however defined, then elect the board of governors. That would seem straightforward enough, but why does the board of governors have such limited powers? Would it not make more sense to combine the board of directors and the board of governors? Indeed, as set out on the face of the Bill, the powers of the board of governors are minute. Boards will have the doomsday power of sacking members of the board of directors. They must be called together to endorse appointments made by the chief executive of the director of finance or other executive directors. That is a strange process when one considers how it would operate. Aside from a public meeting to set the pay and conditions of the non-executive directors, that is about it. Why does not the schedule specify—as suggested in another context in the Higgs report—that there should be a majority of non-executives on the board of directors? Further, why is there no proposal to require any clinical input into the board? All this requires a major rethink.
	This is not put forward with any negative intent, but because I believe that it is important to get it right. New forms of democratic governance are important for the NHS and vital to its future, as are new forms of patient involvement, participation and empowerment. The new trusts will have none of the patients' forums and so forth that were approved in this House only a few months ago, and which are still some way from being established. As I remarked earlier, a little more time spent on the consideration and development of these proposals might make the noble intentions of the Bill a reality. Without it, the achievement of a workable, effective and, above all, meaningful new system of governance for the NHS, genuinely involved with the public it serves, is likely to be lost.

Lord Colwyn: My Lords, although the contentious issue of foundation hospitals may dominate the Bill—I agree with much of what the previous speaker said—there is also a significant dental aspect which I wish to address today. I declare an interest as a practising dental surgeon—I do a little less work now than I used to—who worked in the National Health Service for 20 years.
	The changes outlined in the proposed legislation will be some of the biggest ever to NHS dentistry since the system was set up in 1948. We have heard already today, in the debate on the second Starred Question, about the scenes in Carmarthen, where more than 600 people queued outside a local dental surgery. I shall not repeat the details but it shows that the demand for NHS dentistry is high and yet there is a serious shortage of dentists prepared to work on the NHS. What has been a problem in many parts of the country has now become a crisis.
	The Government have seemingly spent vast amounts of money on the NHS but very little is finding its way into dentistry. The proportion of the NHS budget spent on dentistry has fallen from 5 per cent to 3 per cent. Dental schools have closed, leaving places for only 800 new dentists each year. The system for payment has remained unchanged and incomes still depend on how many patients can be put through the system each day. This has been described by both the profession and by the Audit Commission as a "treadmill". In fact, the Minister himself used that description today. The number of patients registered with NHS dentists has fallen by 5 million over the past five years, in many cases because they simply cannot find anyone to take them on.
	The way in which dentists are paid, the "fee per item of service" system, means that they are constantly under pressure to see as many patients as they can in order to pay their staff and to keep their practices running. A BDA survey last year found that the main reason why dentists reduced their NHS commitment was to spend more time with their patients.
	The Government have consistently assured the public that there would be countrywide access to NHS dental treatment. It was promised for September 2001 by the Prime Minister and the Secretary of State at the Labour Party conference in 1999 and confirmed by the noble Lord, Lord Hunt, for whom I and the dental profession have a great deal of respect. The publication of Options for Change in August last year suggested that there should be a gradual process of change in primary dental care guided by work on field sites. There would be a local commissioning by primary care trusts but no new way of remunerating GDPs.
	But there is a glimmer of hope. The Chief Dental Officer, Professor Raman Bedi, has informed the profession that the Bill before us,
	"proposes to legislate for far-reaching reform of NHS dental services",
	in both England and Wales and to deliver the Options for Change objectives. The new system will replace the old item of service payments and finally rid the profession of the treadmill effect. When the PCTs take responsibility for local commissioning of dental services they will have to assess the needs of people in their areas, not only those living there but those who commute into them and those who are visiting. They will have to provide services within centrally set guidelines and Ministers have made clear that PCTs could not restrict provision to an emergency service or exclude other specialities.
	In view of the agreement in another place that PCTs and local health boards had to meet only the undefined criteria of "reasonableness", it is of great importance to the profession and to the public who use the service that the Minister should define what is "reasonable" and what treatment will be included.
	Access to services, as is shown by the Carmarthen example, remains an acute problem across every part of the country and the changes in the Bill will, in part, address this. However, in properly dealing with the treadmill effect, front-line public dental health prevention is paramount. While I recommend the additional funding promised to PCTs further to address the long-term inequalities, the Government have still not committed themselves on the precise detail of what public dental health should be provided. This is a real problem.
	The local health authorities are in an excellent position to ensure that there is a proper joined-up, proactive and preventive dental public health system in their areas—this should include screening in schools—and yet the detail in the Bill addressing this issue is uncertain. Can the Minister confirm that there will be a dental position on the executive committee of all PCTs and that the Dental Public Health Adviser will be dentally qualified and will be someone who fully understands the issues of dental and oral health?
	The proposed change from a national to local contract, which must be in place by 2005, is of great concern to general dental practitioners. These PCT contracts will look like existing GDS contracts, with the same safeguards but with no necessity to claim for items of service. It would guarantee continuation of existing funding to a practice, adjusted for inflation, in return for the same level of commitment. The contract would be nationally consulted and available to all PCTs and dentists, who could be in individual practices, groups of practices or individuals, will be offered contracts or, if they have not negotiated an individual contract with their PCTs by April 2005, default contracts.
	I know that the new kinds of contracts are being tested in field sites before implementation but, given the very ambitious timescale of 2005, it is extremely unlikely that they will have been fully tested and evaluated. Therefore, can the Minister confirm that the Government will consult and work closely with the dental profession, via the local dental committees and the British Dental Association, on the kind of contract that will emerge to ensure that the best possible outcome is agreed to?
	Could the Minister further reassure me that the Government have considered the position of associate dentists? I am not clear whether the Bill provides for them to have their own individual contracts with the PCTs or whether they have to be a part of a group of individuals. What will happen to practices that are expanding, where the previous year's turnover could be totally inappropriate as a base line? I trust that the department and the profession's negotiators will be discussing these kinds of details as a priority.
	The new arrangements must be made known as soon as possible in order that practices may plan their finances. The money that is promised for dentistry must be ring-fenced and used only for dental services. Many dentists are making plans to increase the private element of their practices because of the uncertainty created by the Government's lack of clarity on the transitional phase of this radical reform.
	With the abolition of item of service payments, patients' charges can no longer be calculated in relation to dentists' fees. A review group will advise on this. Dentists and patients will of course welcome a simpler system. In future, dentists will be able to adopt a more preventive approach without reducing turnover and consider spending longer on more complex work. The dental profession expects the Department of Health to work with it on the planned review into the future structure of patients' charges. I hope that the Minister will agree to this co-operation.
	The Bill will change the measurement of dental workload. For 50 years it has been calculated with reference to the number of fillings, extractions, crowns and dentures provided. That is not the way output is measured in the remainder of the NHS. This problem is being assessed in the field sites, with much more emphasis on the patients' perspective. The dentist will no longer be asked how many fillings or crowns were undertaken. It will be more important to know how many patients were seen; how long they had to wait for an appointment; what arrangements were made for patients with chronic gum disease—with a high risk of caries development—with susceptibility to oral cancer. Can the Minister confirm that the current system of patient registration will end with no differentiation between those patients who attend regularly and those who do not?
	Finally, with the majority of my dental colleagues I am pleased with many of the changes that the Bill will bring to the profession. But much of the good work in the profession is undermined by the rhetoric from the Minister's colleagues in another place, who continually trot out the "free at point of delivery" soundbite while totally ignoring the basic facts in NHS dentistry today that, unless patients are exempt, NHS patients pay 80 per cent—yes, 80 per cent—of their treatment costs. That is the reality of the treadmill in our dental system today. I am delighted that the Government are doing something about it.

Lord Adebowale: My Lords, I declare interests as an unpaid associate member of the Centre for Health Service Management and as a paid chief executive of a social care charity.
	The Bill seeks to make some significant changes to the NHS and I see it as an opportunity to add a finer focus, to add value to NHS customers, to increase choice and to improve quality. There is of course the key issue of foundation trusts. This House will have plenty of opportunity to debate this critical matter, which has generated so much public and media interest.
	Many have rejected the foundation trust concept out of hand as an attack on fundamental NHS values, or because it is change, and change is difficult and challenging at the best of times. I have yet to be persuaded, and look forward to the forthcoming detailed debate with interest. Right now, I am more concerned with some of the fundamental principles that I think are missing from the Bill and, sadly, from much of the debate so far. It is not just principles that are missing from the Bill but some key organisations and sectors that need to be part of our consideration of the future of health, social care and the NHS as a whole.
	With the exception of the contributions of the noble Baronesses, Lady Pitkeathley and Lady Greengross, the debate so far has not thought through the issues of the NHS and its relationship with social care and mental health. It is worrying that a Bill that seeks to increase choice and develop greater partnership working between the NHS and other bodies across health and social care sectors misses out key references to mental health trusts and social care trusts. I would be interested in the Minister's thoughts on how the Bill will affect those important bodies.
	To my mind, the Bill omits a clear role for the voluntary sector and provides little in the way of a framework for how the NHS intends to work with these organisations and the sector in a way that can add value and provide choice. In a recent speech to the NHS Confederation, Health Minister John Reid quite rightly set out his view that choice was a prerequisite of a fair, high quality, value-driven NHS: choice for all, not just choice for those who can afford the private sector or who have the means to employ those who can navigate the miasma of options created by so much change on their behalf. How is it possible to have choice if crucial areas of service provision are absent from the Bill—a Bill which seeks to make fundamental change to the way the NHS operates?
	Let me address the principle that I believe is missing from the Bill. It sets up foundation trusts as independent public benefit corporations, with the primary purpose of providing health care to the NHS. In thinking through what I was going to say, I thought about Turning Point. I am mindful of the fact that Turning Point might already be a foundation trust, given what we have been set up to do. We are an independent body contributing to the public good in the area of social care. We may well be a foundation trust, along with many other organisations that are commonly known by many Members of this House, such as Rethink, Mencap and United Response. It could be argued that they have all been established as trusts and charities—organisations that are independent but operating for the public benefit with the primary purpose of providing health and social care to the public, often directly through contracting with the NHS.
	While many in this House may applaud the fact that the Bill provides the NHS with greater freedom from the Department of Health and politicians, I am interested in how such freedom will operate in partnership with other bodies which are intricately involved in the delivery of critical social care health services to the British public.
	Much of the Bill refers to the NHS framework and operations within this framework. It gives greater freedom to NHS trusts to operate within an independent framework for the public benefit but does not define the NHS's role in the mixed economy of care.
	Is the House aware that according to the recent report by Compass Consultancy, 13 of the largest voluntary sector mental health organisations contribute some 10 per cent of spending on mental health? The combined income of these 13 mental health providers was £320 million last year, of which £154 million was spent specifically on delivering mental health services. The range of mental health services alone covered by these organisations is critical to the mental health and social care of over 300,000 people every year.
	Those figures refer to just one aspect of the contribution that the voluntary sector makes to this debate in relation to mental health. I could also mention learning disabilities and substance misuse as other areas where the voluntary sector is delivering critical services in partnership with the NHS.
	My main concern relates to the fact that many of these organisations struggle to establish a level playing field on which partnership can be seen as adding value and sharing risk with the NHS. It is my view that in the delivery of health and social care there is a third way, which the Bill does not go far enough to define and include. That way involves voluntary sector organisations delivering critical social care services and working with the NHS in a framework yet to be defined by the Bill in a way that ensures that they continue not only to add value but make the necessary moves to reverse a law which I have often referred to in speaking to this House—the inverse care law, under which those who need services most tend to get them least.
	For this level playing field to be created, the Bill needs to say more about how it expects the NHS, in whatever form, to relate directly to the voluntary sector. In my view, this should be through better contracting and better management of the markets in which the healthcare trusts operate. The Bill could do much more to define or, indeed, create that.
	Secondly, I wish to turn from principle to practice. I am surprised that there is scant mention in the Bill of mental health and social care trusts. It is as though the Bill is focused only on acute problems, yet we know through the Sainsbury Centre for Mental Health that 50 per cent of people with acute needs have mental health and other social care problems.
	Why does the Bill not take the opportunity to focus on where the NHS is spending large amounts of money in what is often a disorganised and unstructured way and provide a framework within which mental health and social care trusts can operate at the same level of consultation and respect for their contribution? This will of course require some reallocation of resources in order to allow mental health and social care trusts to catch up with those organisations that the Bill focuses on to the detriment, in my view, of social care and mental health. Why is this the case? Can the Government see the Bill as an opportunity genuinely to increase the ability of the NHS to deliver social care and mental health in partnership with not only those organisations contained within its own structure but those currently working as unequal partners but who wish to be equal partners in the delivery of health and social care for all?

Lord Blackwell: My Lords, I declare an interest as a director of a mutual that provides health insurance policies.
	Like other noble Lords who have spoken, I welcome the Bill so far as it goes and the direction of the policy it sets for the future. But I am, as others have been, critical that the Bill does not go far enough. Not only does it not go far enough in the provisions for foundation hospitals, but it does not tackle the other side of the equation—the freeing up of the commissioning side of the health service, to which the noble Lord, Lord Harris, referred. I, among others, will want to press the Government as we go through the Bill on whether they are prepared to follow through the logic of what they are setting out in both the Bill and what follows it.
	The problem with the NHS, as many noble Lords have mentioned—I was particularly struck by the descriptions of the noble Lords, Lord Hunt and Lord Desai—is that the structure is run as a large nationalised industry. As the noble Lord, Lord Hunt, said, it is the same structure that was introduced in 1948. The NHS is a sad example of the problems that result from a nationalised industry structure with which we have been sadly too familiar in many other parts of the economy in the past. Local management loses control, loses incentives and manages upwards, creating demoralisation and a need for incentives to intervene with initiatives that further compounds the problem and creates a spiral of inefficiency in which the patient is the loser.
	Within that structure, according to figures released earlier this year, the 20 per cent additional resources that have been put into the NHS since 2000 achieved only a 2 per cent rise in activity. We can have little confidence that further money put into the same structure will achieve any better outcomes.
	I believe that it is time to accept a new reality—the reality that centralised states running nationalised industries simply does not work. We should finally give up the search for ways in which the state could run such structures better and accept that the only solution is for the state not to run them at all. That requires a commitment to a radical vision of a denationalised health service—not a tinkering around the edges but a fundamental shift. We need to ask not only whether the Bill's suggestions are necessary, given the history of health service reforms, but also, if this is the one occasion to get it right, whether the Bill goes far enough. Alas, I believe that it does not.
	Two parts are required to create and complete the vision of a denationalised health service. First, as the Bill starts to do, we must break all hospitals and all other facilities out of state control and make them truly independent local entities, whether voluntary, charitable or private companies, which are able to manage their own delivery for the patients whom they serve. That is much as they were before the state stepped in and nationalised them half a century ago.
	Such reforms, however, even if they were completed, would be inadequate on their own. As the noble Lord, Lord Harris, pointed out, the real power in a health structure really rests with the purchasers—those who are commissioning. If we complete the dismantling of state control and allow innovation to take root, we also have to take the government out of being the monopsony purchaser. Monopsonies can be as damaging to industries and sectors as monopolies, and in the health sector we have had both. It is damaging because, with all the spend controlled against Whitehall priorities, it still leaves all the control levers in the hands of a centralised bureaucracy. Unless we deal with both sides—the commissioning as well as the provision—we shall not get the change that the Government and the Minister say that they are seeking.
	Elsewhere I put forward proposals to create more diverse commissioning structure by enabling patients to take their share of NHS funding and to transfer it to independent healthcare managers who would contract healthcare services on their behalf. That would cover both primary and secondary care, so as to optimise the overall healthcare quality and costs. This is not the time or occasion to repeat those proposals or to go into detail, but it is possible to envisage structures where that can be achieved.
	As long as taxation provides the funding for a service that is free at the point of delivery—and I for one fully accept that taxation should remain the core component of health funding in this country—the state needs to set bounds around the core package of care, saying what it should deliver and its costs. However, that should be a minimum and not a maximum or a constraint, and patients should have the option that only the rich in this country currently have to exercise their choice, rather than having to put up with what is delivered to them.
	I agree with noble Lords who said that the criticism that foundation hospitals are creating a two-tier structure is not a proper one. At the moment, we have a multi-tier system of inadequate service whereby how inadequate it is depends on where one lives and how well one is able to manage one's way through the rationing gateways. The fact is that it is generally the poorest and those least able to manage their way through those gateways who are treated the worst. The only way in which to improve that is to allow some areas to create standards of excellence and to encourage all hospitals and other health providers to catch up. We need the power of patient choice and free commissioning to drive that, and the problem with the Bill is that it goes only a small part of the way towards that vision of the patient-focused, decentralised and denationalised health service that we need.
	First, the objective of fund-holding is not really carried through in the Bill, because in reality the fund-holding hospitals will have to meet the same central targets and initiatives. That will happen through the actions of the regulator and of CHI, with its attempts to make compliance and annual reviews around star-rating systems, and by the fact that the hospitals cannot change their range of services and will be hemmed in by centralised union agreements.
	As the noble Baroness, Lady Hanham, made clear, hospitals will be over-burdened by government structures, interest groups and appointees, as well as all the other government structures around the NHS. As the Treasury has recognised, under that set of controls, they are not truly denationalised, so according to the Treasury formula they cannot be allowed to raise significant funds. As my noble friend Lord Howe pointed out, we will have a zero-sum game whereby the funds that hospitals are able to raise will come off the amount to be spent by other hospitals. That is a poor approximation to the kind of independent decentralised fund-holding that we should aim for if we want innovation and service delivery.
	Secondly, the Bill does nothing to create more competition and choice in purchasing. The primary care trusts that control 75 per cent of the funds have very little freedom in reality to deviate from centralised priorities. We shall not get innovation or freedom unless that situation is changed.
	One immediate step that the Government could take would be to announce that they will create foundation primary care trusts, which would have real freedom to spend their per capita allocation. If they took that step, it would be a simple step beyond that to allow people to move from one PCT to another, creating a basis for the kind of vision that I have proposed. As we go through the Bill, I should like to ask the Minister whether the creation of foundation primary care trusts is any part of the Government's current proposals or of what they would consider putting forward. It is an essential reform that must go hand in hand with a proper system of foundation hospitals.
	Even if the Government are not prepared to commit to that, I hope that the Bill as the House may amend it may at least provide some of the basis from which a subsequent and bolder Government may proceed more rapidly to complete the transformation to a decentralised and denationalised structure that is free to deliver the quality of healthcare that the nation deserves. I welcome the Bill as making at least a step in that direction, and I congratulate the Minister on taking that step tonight.

Baroness Howarth of Breckland: My Lords, before I begin my formal speech, I express a hope that the Minister has more success in this complex Bill than some of us have had this evening in trying to do something about the cold in the Chamber. Before we get this health Bill through, some of us may die of hypothermia.
	In welcoming the Bill, I declare an interest as the vice-chair of the National Care Standards Commission. However, I shall not be part of the new Commission for Social Care Inspection, so I feel pretty free to comment on the new arrangements as the Bill passes through Parliament.
	I recognise that the debate in another place—and the debate today—has largely been about foundation hospitals. However, whatever happens about that issue in the debate, Parliament must retain a clear focus on carrying through the proposed changes to regulation of services for children and adult users of services. Indeed, the National Care Standards Commission has worked hard to ensure that preparation is in hand and that there is readiness for that change.
	The size and scope of the social care sector must not be overlooked. The National Care Standards Commission alone regulates 40,000 services, which provides just under half a million care homes and supports hundreds of thousands more people so that they can keep on living in their own homes. Add to that the services for children, the relatives of all those folk and the social care aspects of the Bill touch the lives of most of us.
	The role of the regulator is essential to both health and social care sectors. Having a single social care regulator with a single set of standards should give individuals the confidence to know that they will receive appropriate care, no matter who provides it or where it is. That is essential if a mixed and diverse economy of health and social care is to flourish. After all, it is a sign of a civilised society that it protects people and helps them to improve the quality of their lives, particularly those with less capacity to do so for themselves. It is important that we all ensure that the Bill has that philosophy at its heart. I ask the Minister to give reassurance on that.
	We have thankfully moved away from the era when society took the view, "Out of sight, out of mind", particularly, for example, in relation to frail older people, with care homes regarded as institutions. However, there is still a lot of work to be done. Only last October, National Care Standards Commission inspectors discovered a home where the staff thought it was appropriate to tie an old lady to a chair with a dog lead to restrain her movement. It is that kind of abuse of trust and denial of dignity that we still need to stamp out. Private hospitals, indeed, have not been without their difficulties. More examples of our work can be found in our annual report—which, as background, I think it would be very useful for Members to look at as we go through this debate.
	It is, however, also vital that we listen to the voices of those who use our services. Can the Minister assure me that the new commission and the Commission for Healthcare Audit and Inspection will build on the foundation work to develop extensive consultation with service users and their representatives, particularly with children? It is vital that those children's voices are heard and taken account of. No one knows more about the services than those who use them. If we ignore those voices, saying that adults and professionals know best—and I say that as a professional—we do so at our peril.
	England's Children's Rights Director, working out of the National Care Standards Commission, has developed a range of consultations with children in public care. We hope that that valuable experience will be carried into the new commission. This Bill, as we have heard today, has its Second Reading on the day of the publication of the children's Green Paper. We welcome the wide range of that paper and in particular the announcement of the office of the Children's Commissioner. It will be essential that the new commissioner, the Children's Rights Director and the new Children and Families Directorate in the Department for Education and Skills work together to listen to the voices of children and to sustain and improve services for them, particularly in the area of health.
	Last week, a colleague told me that when he visited a hospital to try to get more focus on children's services, the manager told him, "You don't lose your job for failing children's services, mate". Will the Minister give assurance that all our services working together will ensure that no manager can make such a comment in the future? Perhaps one of the tests for foundation hospitals should be just how child friendly they are, because child friendly places are usually also friendly to adults.
	For the foundation hospital debate links to the debate on regulation in that all of these services must work in partnership to achieve best results for all who use them, especially vulnerable users. We must begin to see services as whole systems, not departmental silos, where people can move effortlessly between providers with the same certainty of good service whether in health or social care provision. The boundaries need to be clear, but the provision must be excellent. So it is essential that within this framework proper regulation is much more than inspection or performance management. For example, by conducting a tight control on registration, through rigorous checks and controls, the National Care Standards Commission is able to stop poor services from entering the market, which seems to me far better than picking up the pieces after things have gone wrong.
	The NCSC is a watchdog that can bite, and the new commissions, CHIA and CSCI, will have powers contained in the Bill to assume a similar responsibility. That is particularly important, as I said, as a mixed economy of provision develops. However, if I had one complaint about the time I have spent building up the new commission, it would be the problems faced through a lack of independence in implementing the national minimum standards. Such standards are of course vital as a framework to ensure the confidence of users and in setting their expectations of a decent service, but they must not stifle innovation and positive change. To ensure that, the new commissions must have enough freedom and flexibility to resist political expediencies and to focus on sustained improvement in services.
	I am vice chair of the John Grooms Association for Disabled People. Although we want to give young disabled people their own larger space, if we did so, we would lose communal space. That would not meet the standards. We have to be flexible enough to give really good services to people such as those young disabled people.
	I conclude by again making the plea that, in the important deliberations about foundation hospitals, this House should not lose sight of the importance of those parts of the Bill bringing in a new phase in regulation and inspection. As we move forward, it is important to build on the work of the past two years, when we have seen England's first social care regulator set up and its 2,500 staff develop a substantial knowledge of how to make this work in practice. Most of all, in the debates, let us keep in mind those who will use the services, and build on the work of consultation not only with providers and those who work with users but with the users themselves—whatever the structure the Government put in place to achieve that.

Lord Sawyer: My Lords, it gives me great pleasure to speak in this debate. I should like to declare a couple of interests. I am the chairman of Reed health group, and I am also a member of UNISON. Like most noble Lords, I suspect, I enjoy these debates more on some occasions than on others. However, I think that this debate has been particularly informative. It has made me think a lot about the issues before us. I was particularly impressed by the contribution from the noble Baroness, Lady Hanham, in which she grappled with the issue and heavy responsibility of the need to perform tasks on a daily and real-time basis. She outlined some concepts and ideas which the Bill has given her and tried to work out how the new initiatives and ideas can help in the real world in which patient care must be provided.
	In one way, the Bill is very simple. It contains a simple but very big idea—locally owned hospitals. It is a wild thing to say. If we really believe that one day we will have locally owned hospitals funded by the owners—the taxpayers—free from much government interference and perhaps responding to purchasers as mutuals rather than as plcs, then it is a very big idea. I do not believe that it will be achieved by this Bill alone. I do not think that anyone should believe that. I thought that the noble Earl, Lord Howe, explained very adequately how it is impossible to make such a big leap in one Bill. But the Bill is one step along the road that must be followed if we are to move from this huge bureaucratic, monolithic nationalised industry that, by force of circumstances, Nye Bevan had to create, to locally owned hospitals. It will be one important step.
	I share the view of my noble friend Lady Pitkeathley. I am sorry that this great, big idea has been damaged to some extent by political divisions. If the big ideas in the Bill had been properly discussed outside Parliament in the wider community and people had been given an opportunity to express a view before we were saddled with the Bill, as it were, those divisions would not have arisen. That is a great pity. I hope that my party leadership will learn the lesson in what we might call the post-Campbell era and understand the importance, which is enshrined in this piece of legislation, of including and involving people and listening to their opinions before we make decisions. I hope that we can learn that lesson in the future.
	The Bill was introduced to Parliament by the former Secretary of State, Alan Milburn—a man whom I hold in the highest regard. In my view he was one of the most radical and innovative Secretaries of State in the history of the health service. As I said, his vision of a democratic and accountable health service is at the heart of the Bill. My instincts follow his on that matter. In some ways I do not see this as a complicated matter. If I were to strip it down in terms of how I would run a hospital, I would do so in very much the same way that I would run anything else. I have run trade unions, businesses and charities. In all circumstances the most important people are the customers. In the case we are discussing they are the patients.
	The second most important people are the staff. If we do the right thing by the patients and the staff, we shall not go far wrong. I refer in particular to the front line staff and to the cleaners, the cooks and the blue collar workers, as it were, who are often forgotten. Managers, politicians and civil servants should be the servants of the front line staff. I do not think that that has ever happened in the National Health Service. You turn the pyramid on its head and you make the bosses and the politicians the servants of the people who serve the patients. That is the kind of vision I should like to see enacted. That is how I envisage a publicly owned local hospital working.
	I believe that Alan Milburn understood that. In Agenda for Change—this is slightly different from the main matter we are discussing tonight but it is still relevant—he hammered that agreement out with the trade unions. I spent 20 years as a union official linked to the National Health Service and I never dreamt of such a good agreement. Agenda for Change offers marvellous opportunities for staff and most of the unions have endorsed it resoundingly. I was very pleased to hear the Minister say tonight that foundation trusts would be required to implement Agenda for Change. That is a wise decision.
	My instincts also follow the central aim of the Bill which is democracy and local ownership and giving employees, patients and others in local communities real power over how the service is run. As noble Lords have said, after 50 years of National Health Service provision inequalities of health between the richest and the poorest in our communities have widened. But the issue of inequalities goes well beyond the provision of healthcare and includes much wider issues of class, opportunities, housing, lifestyles and so on. The question is whether a new and more democratic form of governance at local level will make even a small contribution to dealing with those inequalities. I think that it will.
	All my experience in all walks of life reinforces my view that if you bring customers and staff together with other interests at local level, whatever they may be, and give them real ownership—I say this to the noble Lord, Lord Desai—you get a very different set of circumstances. You get different priorities and different solutions from those you would have achieved through a Minister, a hierarchy, a chain of command or a management structure. Things start to change when bureaucracy is removed and people start to think about new ideas or providing a different service. That will demand a very different kind of response from the Minister or the regulator or whoever might be involved. That is why I say this is a very big idea. The implications are very far-reaching if we are to respond to people taking local ownership in the way that I have discussed.
	That matter is relevant to many parts of the Bill, not least to the regulator who must be accountable and in some ways appears to take over the role of the Minister. The regulator will need to display much wisdom and courage in responding to what could be very different and challenging situations that arise in locally owned hospitals.
	Standing far back and enjoying the vision of the big idea, if I have not been misled in my enthusiasm for it—I do not believe that I have been, but I fully appreciate why people might not want to get so far back and involved with the practicalities—I think that support will come from communities, managers, staff and patients for a new kind of hospital that belongs to them. I really like the feel of that.
	I would like to see people joining hospitals. I do not know very much about what the panel really means, but I am a member of a mutual building society and am really glad that I am in it. It is different from being in a bank, and I am proud of being a member of it as I get different things from it. If I could join my local hospital in something like the same way, I would be very interested in what that might mean for me, my family and my community. If that is the path down which we are travelling, I would be very interested to go down it.
	Finally, there is a question about who can run a foundation hospital. The Secretary of State has said that the foundations will not be able to make a profit or pay a dividend, so I presume that that precludes plcs from becoming involved, because it would be against the law. Therefore, I guess that we are looking—if the current people are not running them; I do not see why they should not be—for people with new ideas and new offerings perhaps to come from mutuals or combinations of mutuals, or something like that. We should knock on the head the idea of privatisation, because it does a lot of damage to people who are supportive. If that idea could be killed off, it would be good.
	Had the Bill been properly discussed through a Green Paper, some seminars and some debates, it would be the toast of Bournemouth in two weeks instead of the curse that it is going to be. That aside, in this House let us take the challenge as we normally do, bring the reasoned argument to bear and see if we can make the legislation better as it goes through Parliament.

Lord Turnberg: My Lords, it is a great pleasure to follow my noble friend Lord Sawyer and his very perceptive speech, which I enjoyed. I would like to comment on foundation hospitals and the Commission for Healthcare Audit and Inspection. I should first express some of my interests. I am an ex—well, I am an ex-several things, but I am an ex- academic physician, and am now vice-president of the Academy of Medical Sciences, adviser to the Association of Medical Research Charities, and a member of the medical advisory boards for inventures and nations healthcare. Those two bodies were set up in response to government initiatives, to provide support services for the NHS.
	Along with almost everyone I know, I am strongly in favour of the principle of devolving responsibility for running health services to more local levels. Anything that can loosen the tight reins of central control is to be welcomed. I resonate very strongly the erudite comments of my noble friend Lord Hunt. I view foundation hospitals as a step in the right direction, and it seems not unreasonable—to me at least—that those who have shown that they can manage their affairs reasonably well should be given the chance to do so soon.
	Of course there are anxieties, which many have expressed, about whether the new status will give hospitals unfair advantages over other hospitals, and will drain resources from one to the other. I do not really believe that, but clearly that is not what a national health service should be about. It is for that reason that the Government should ensure that the first wave of foundation hospitals is very closely followed by second and third waves, so that all hospitals should very quickly share in the potential benefits of devolution. If talk that I have heard of 50 per cent of trusts becoming foundation trusts in five years is true, that seems far too slow. We must be quicker in spreading the benefits.
	There is another reason for spreading devolution to all, which is the current method of selection—the star system—which may not be entirely without its faults. It may well select for managerial skills and financial control, but I am not convinced that it selects for patient care. If noble Lords will bear with me, I would like to tell them that I spent my summer vacation in Manchester, going from hospital to hospital with sick and ageing relatives. We were all very impressed with the standards of care and service that they and I received. The kindness and attentiveness of staff, the cleanliness, and even the food were hard to fault.
	When I spoke to the medical and nursing staff later, they told me that the number of consultants and nurses had risen remarkably in the past few years and that their morale had risen. Pace the noble Lord, Lord Alderdice, I detect a faint breeze of change in the morale stakes. What a change from a few years ago. It made me quite proud of an NHS that seemed different from what we read about in the press, and I believe that that is a credit to this Government.
	My point in telling you that is that neither Hope nor Withenshaw hospitals—those in question—have accumulated the stars necessary for foundation status. But if you ask the patients, you will get quite a different story. They believe that they are marvellous. My mother-in-law gave Withenshaw hospital five stars—and she is no push-over. The stars and the views of the patients are not coinciding—there is a discrepancy—so it will be important to avoid delay in the transition to the next phase of those deserving trusts.
	I turn now to an important function of foundation hospitals which deserves greater prominence in the legislation; that is, their role in teaching and research. Virtually all hospitals carry out some teaching and research, but those in university centres with medical schools play a vital role in teaching the doctors and nurses of the future and in pursuing the kind of research that is so fundamental for future healthcare. We in the UK have considerable strength in the basic biological sciences. We have excellence in depth in molecular biology, genetics, immunology and so forth and we have a remarkably successful and innovative pharmaceutical industry. However, we lack the facilities and researchers who can translate the fruits of that marvellous basic science into the care of patients. Nor do we have the facility to take full advantage of the potential in the pharmaceutical industry's inventiveness.
	The clinical trials in hospitals and primary care, and with patients, are so essential, but the infrastructure for that does not exist. What does exist is being squeezed out by the ever-increasing pressures on the NHS to deliver today's clinical service. I would therefore like to see in the Bill a much greater recognition of the need for the new trusts to take responsibility for ensuring that research and teaching are a fundamental part of the work of university teaching hospitals both in the ways they are governed and in the ways they function.
	I want to say a few words about CHAI, the Commission for Health Audit and Inspection. One of the difficulties which besets clinical practice—it was referred to by the noble Lord, Lord Alderdice—is the need to respond to ever-tighter and more detailed regulation. Quite apart from the need for doctors to keep GMS guidelines in mind and to meet the requirements of the medical royal colleges for standards and training, they are increasingly hide bound by government initiatives, guidelines, protocols and regulations which cover every aspect of their clinical practice.
	We have now accumulated a long list of requirements. While each of them in themselves may seem entirely rational, when they are seen in their entirety they pose an enormous burden which distracts clinicians from their primary role of caring for patients. What is needed now is a close examination of the multiplicity of regulatory bodies and requirements. I am delighted therefore to see the first steps being taken with CHAI, which seems to subsume three previous bodies. That should undoubtedly help, but I hope that that is just the beginning.
	We must take a close look at the effects of current controls. Are they in fact improving healthcare and making it safer, or are they simply a distracting burden, inhibiting good clinical practice? I hope that the Government will build on their commendable efforts on CHAI and look at what more needs to be done to rationalise and reduce this morass of regulation.

Baroness Barker: My Lords, having never been a Minister, I have my usual solitary declaration of interest to make. I am an employee of Age Concern England. I am delighted to be able to sum up a wide-ranging debate which has done the Bill a greater service than was done in another place, where vast sections of it went unremarked. In our debate we have focused on three important matters: evidence-based commissioning; evidence-based planning and evidence-based supply.
	In another place and in the press some have sought to characterise the debate around the Bill as concerning those who wish to modernise the NHS to set it free from restrictive and centralised micro-management versus those who want to preserve a monolith. I believe that such a characterisation is unfair. Last year we on the Liberal Democrat Benches put on record our policy paper in which we expressed a commitment to local management of public services, including health. We are in agreement with the stated aim of devolving decision making to local communities. The problem is that we have a great many reservations about the precise proposals in the Bill because we see limited decentralisation, inadequate democratisation and piecemeal reorganisation. Like the noble Baronesses, Lady Gould and Lady Masham, we have considerable reservations about the commissioning of specialist services in particular.
	This is a curiously disjointed Bill that has prompted some very unlikely reactions. Many people have focused on foundation trusts as the break up of the NHS, while at the same time they have completely ignored the import into the NHS of private provision of diagnostic and treatment centres. While many organisations have expressed concern about the fairness of access to health services, very few have noticed the potential disincentive inherent in the tariff system for trusts to treat those patients who are more costly than younger people who recover more quickly.
	We welcome parts of the Bill, inasmuch as it is possible to discern exactly what effect the regulatory powers will have. It has taken the Government 18 months to accept the argument put most strongly by my noble friends Lord Clement-Jones and Lady Nicholson that private healthcare and NHS healthcare should be subject to the same standards of audit and inspection. One is almost tempted to say better late than never. But on closer examination of the Bill it becomes apparent that the Commission for Healthcare Audit and Inspection and CSCI will enjoy considerably less independence than their forerunners, so our delight is somewhat tempered.
	We also give a partial welcome to the proposals to give PCTs and local health boards responsibility for commissioning NHS dentistry, including general dental services. The arguments on that were most eloquently put by the noble Lord, Lord Colwyn, and I do not wish to repeat them. I simply say that the case of two weeks ago in which a PCT could not release the name of a new NHS dentist in an area should be evidence enough to us all that the noble Lord, Lord Colwyn, did not overstate the crisis at all.
	We on these Benches have two major concerns about the Bill. First, the Bill as a whole does not concentrate sufficiently on primary care, prevention and health promotion; and, secondly, the proposals for governance, performance management and accountability are so inconsistent that they give very real cause for concern about the extent to which strategic planning and fair access can be assured across the NHS.
	The noble Lord, Lord Adebowale, was absolutely right. So far the discussion has focused almost exclusively on foundation hospitals. I say to the noble Lord, Lord Sawyer, that the Bill is the Government's response principally to the Wanless report. The response was outlined 18 months ago in the NHS Plan and in Delivering the NHS Plan. At that time we debated those documents in your Lordships' House. All the way through we have noted one particular recommendation which is absolutely fundamental. The Wanless commission looked at the future demand on healthcare services over the next 20 years and one of the key recommendations was that there should be a similar investigation into social care because health and social care are two sides of the same coin. Since then the Government have studiously ignored that recommendation. Until that advice is heeded, I am afraid that all Bills which come before this House will be about tinkering with the NHS rather than dealing with fundamental planning.
	I share some of the more interesting points made by the noble Lord, Lord Adebowale. As the Bill passes through your Lordships' House we need to be thinking not only about elective surgery but also about the management of chronic conditions. I think that much that is in the Bill is based on predictable healthcare conditions and not on the management of long-term conditions.
	There is a key flaw in the Bill, which was pointed out by the former Minister for Health, John Denham, during the debate at Second Reading in another place. He said that,
	"we need to do more on strategic planning. At the moment, no one is entirely responsible when things go wrong. It is not quite the hospital management, the trust board, the PCT, the strategic health authority or the Secretary of State. If we are not careful, we will still have a system in which PCTs plan from the bottom up, and strategic health authorities sort out problems from the top down".—[Official Report, Commons, 7/5/03; col. 746.]
	I have spent the summer watching the preparations for the implementation of the Community Care (Delayed Discharges etc) Bill. I think that this Bill threatens something much worse. PCTs will commission services on the basis of targets set by the Secretary of State, which are arbitrary and unrelated to health outcomes, while acute trusts will work to a weakened system of accountability.
	I was very interested in what the noble Lord, Lord Turnberg, had to say. I think that he was almost the first person to use the words "clinical governance" in the debate. As the noble Lord said, the star rating system that has been used so far has been seriously inadequate in the way in which it relates performance to health outcomes.
	I should also make the observation that many people have talked about the star rating system as being a limiting factor in that if one has only one star one is not in a position to come forward for further resources and status. I have to say that, certainly in the field of social care, the three-star status has become a significant problem. Those of us who work not in the statutory sector but in the voluntary sector have considerable problems in going to, in particular, social services departments where we can see serious inadequacies of services for individuals only to be told, "We are a three-star service". It has become a barrier to improvement that we cannot get through. That is dangerous.
	A number of noble Lords have mentioned the governance arrangements in the Bill. I want to say that I am simply not convinced by the argument put forward by the Minister in another place that the specific format for incorporation is necessary because it makes dissolution in cases of insolvency less difficult if one does not use the standard charitable legal framework. I think that that calls into question the extent to which foundation trusts will be independent and accountable in practice to the people whom they seek to serve.
	I have a further concern about accountability. It is possible to see how a general hospital within a defined locality—for example, a county or a major conurbation—could draw upon the population of a defined geographical area to develop an electoral constituency, which not only has an obvious relevance to the life of the people within the locality but is of a sufficient size and diversity to ensure that there is strategic governance. However, it is far from obvious how specialist providers such as Moorfields, Great Ormond Street or Addenbrooke's will be able to develop such a robust system of membership. Furthermore, the issue of the governance of tertiary units within acute hospitals is simply not addressed within the Bill.
	I would go further and echo the concerns of one or two of the speakers in today's debate about what happens under that system of governance to the needs of minority populations and people with minority conditions. That leads me to one further point—that of strategic planning of commissioning and provision of specialist services within the NHS. Noble Lords will know that over the past couple of years in this House we have considered, in particular, neurological conditions and the lack of compatibility between centres of excellence in acute trusts for the diagnosis and immediate treatment of those conditions and community practitioners in the long-term management of neurological conditions. One suspects that that is likely to be subject to further fragmentation under the new system.
	I believe we shall have to consider one or two other measures in the Bill particularly closely in order to decide whether or not we wish to pursue them. The proposal to extend the powers to recover costs in road traffic accidents seems to be a measure that we should support only in so far as it will act to prevent and discourage the increasing recourse to the compensation culture making its way into the NHS. If it does that, we should support it; if it does not, we should stamp on it heavily.
	The proposals to reform welfare foods are, on the face of it, a welcome modernisation. However, I want to ask the Minister whether the overall level of provision is likely to rise or fall and who will monitor the effectiveness of the new system.
	As I said, the Bill has within it an inconsistency and an incoherence which are of concern to those who want to see the decentralisation and democratisation of excellence and not the shifting of blame within the NHS.

Baroness Noakes: My Lords, this has been an interesting debate with extraordinarily high-quality contributions. My noble friend Lord Howe set the scene for the debate on foundation trusts with his devastating critique of the part of the Bill that deals with foundation trusts. My noble friend Lady Hanham raised powerful concerns about the governance arrangements, as echoed by many other noble Lords, including the noble Lord, Lord Harris of Haringey. My noble friend Lord Blackwell set out a more radical vision, removing both monopoly and monopsony. He, too, offered significant challenges to the Government's policies on foundation trusts.
	I listened very carefully to the contributions from the Benches opposite on this subject and I do not believe that I heard overwhelming support for foundation trusts from the Minister's noble friends. Even the loyal support from the noble Lord, Lord Hunt of Kings Heath, was hedged about. The noble Lord, Lord Hunt, finished by asking whether Ministers will refrain from interference. Perhaps I may offer my answer to that question: no, they will not because too many strings have been left in place to be pulled and tweaked by Ministers.
	Perhaps I may restate our position on foundation trusts. We believe in real freedoms for hospitals and we do not support intrusive, government-dominated interference by a so-called independent regulator. We do not support the chaos and expense of the pseudo-democracy of the governance structures. We oppose Gordon Brown's zero-sum game whereby the borrowing of foundation hospitals will displace investment in the rest of the NHS. What unites these Benches with the Liberal Democrat Benches is wide and deep opposition to Part 1 of the Bill, which I am sure we shall explore in Committee.
	Moving on from the subject of foundation trusts, my noble friend Lady Cumberlege made a thoughtful speech. She highlighted the incompatibility between local decision-making and Labour's notion of equity, and she pressed again the desirability of taking politicians out of the NHS. Those thoughts were supported by many on all sides of the House. Separating politics from the NHS is now an urgent matter. It is not dealt with properly in the Bill and, again, that is something that we shall need to explore further in Committee.
	I am very glad that my noble friend Lord Colwyn reminded us of the importance of the dental aspects of Part 4 of the Bill. He raised serious questions which deserve comprehensive answers from the Minister. Several noble Lords made important points about the operation of CHAI and CSCI. My noble friend Lord Bridgeman raised questions about timescale and division of responsibilities. I hope that the Minister will reply to them.
	My noble friend Lord Howe outlined our determination that CHAI and CSCI shall be properly independent bodies. But before discussing independence, let me first signal our opposition to the limitless powers of CHAI to gather and use personal data. Anybody who heard the representative from CHI on the "Today" programme this morning will have been chilled at the apparent disregard for the principles of patients' anonymity and informed consent. Clause 66 is not acceptable in its current form.
	Perhaps the most interesting insight into the Government's thinking on independence for CHAI and CSCI is the language that they use. The regulator being created for foundation trusts is called an independent regulator. Of course, the regulator is not independent, but that is how he is described. When we come to the creation of CHAI and CSCI, the word "independent" is nowhere to be found. In another place the Government rejected amendments tabled by Conservative Members to include the word "independent".
	The reason is simple: the Government do not intend to allow those bodies to be independent. The mantra that they use is "more independent". We do not see independence as a relative concept but as an absolute one. If a body is beholden to the Secretary of State in any way it is not independent.
	The Bill is full of ways in which the independence of CHAI and CSCI are compromised. The chairmen and members are appointed by the Secretary of State. The Minister can say what he likes about the Government's intention to use the NHS Appointments Commission, but the fact remains that the Government have kept the power to appoint in the Bill.
	The Secretary of State can remove the chairmen and members. He just has to satisfy himself that they are not carrying out their duties. There are no rights of appeal or preliminary processes. The Secretary of State will hold a loaded gun at all times. Who can remain independent in those circumstances?
	For good measure, the Secretary of State will determine pay and pensions. Modern corporate governance involves remuneration committees for pay and conditions, but the Secretary of State is a control freak and will not relinquish any powers.
	There are three aspects to independence: appointment independence, operational independence and financial independence. The Bill fails the appointment independence test. It also fails the other two tests.
	There is no operational independence because the Government have retained the right to direct CHAI and CSCI. Even though the power to direct CHAI to follow government policy is limited, there are the sinister Clauses 130 and 131, which allow the Secretary of State to issue any direction whenever he considers that either body is failing to discharge its functions "to a significant extent".
	Do not believe any assurances that those are necessary back-up powers to deal with extreme circumstances. Powers of direction do not have to be used in practice to have a profound impact on how a body behaves. When everyone knows that the Secretary of State can ultimately get his own way, it is entirely rational for people who work in that environment to behave just as the Secretary of State wishes. Civil servants are trained to ensure that their political master's wishes are well understood.
	Lastly, the bodies do not have financial independence—that means being able to decide what resources you need to carry out your functions and then being able to raise the income to cover that. Neither CHAI nor CSCI is in that position. The Secretary of State may let them raise income by charging fees, but there is no guarantee that the fees received will cover their expenses. There is no obligation on the Secretary of State to meet any net expenses of CHAI or CSCI and the bodies have no power to borrow money. To use a wrestling analogy, that amounts to a financial full nelson, with CHAI and CSCI helpless on the mat while the Secretary of State extracts his submission.
	We believe that the new bodies must be properly independent of the Government which is why we shall be bringing forward amendments in Committee to ensure that that the hand of the Secretary of State is removed as far as possible from the affairs of CHAI and CSCI.
	I turn to the rest of this Bill. Despite its length, the Bill can be properly understood only when the various regulations are published. It will doubtless come as no surprise to noble Lords to find that not a single one of the regulation-making powers that litter this Bill will be subject to the affirmative procedure. I give just two problem areas: the new system for the recovery of NHS charges under Part 3 and the welfare foods scheme in Part 5 could both be introduced without adequate parliamentary scrutiny. That is not satisfactory.
	I hope that we will not be asked to approve these extensive regulation-making powers without quite detailed knowledge of the likely content of the regulations and their timing. I invite the Minister to outline the Government's plans for draft regulations and to commit to having drafts available before the start of the Committee stage of the Bill.
	Much of the Bill received little scrutiny in another place. The important clauses in Part 4 dealing with the new contract for GPs were introduced on Report with only a few minutes of debate. The welfare foods scheme in Part 5 was not debated at all. The Committee proceedings in another place were guillotined before the Committee had considered the provisions relating to the CSCI. We on these Benches are committed to every part of this Bill receiving the most thorough scrutiny, however long that takes us in Committee.
	The Government have a relentless desire to re-shape the NHS. As one policy fails, they invent a new one. They fail, however, to see that what is wrong with their policies is their inability to trust the NHS and the consequent desire to hang on to every power possible over every corner of the NHS. We can see that particularly in their policies towards foundation trusts and CHAI and CSCI. As my noble friend Lady Cumberlege reminded us, what the NHS needs is less Government, not more. That is what will drive our contribution to this Bill as it proceeds through your Lordships' House.

Lord Warner: My Lords, we have had an extremely thoughtful debate, although perhaps we went a little downhill towards the end. I do not necessarily agree with all the points raised and I cannot cover all of them. If I cannot do them justice, I will write to noble Lords after studying Hansard.
	I assure the noble Baroness, Lady Noakes, that I did not feel too devastated by the analysis offered by the noble Earl, Lord Howe. I recognise that there is deep opposition to Part 1 of the Bill on the Benches opposite. I wonder whether that is because we on these Benches do not favour the type of market solutions implicit in some of the remarks made from Benches opposite. In his contribution, the noble Lord, Lord Blackwell, occasionally let the cat out of the bag.
	It is a bit strong to make remarks about the Secretary of State as though he were some kind of WWF participant. That was a bit fanciful, given that the provisions on powers of direction and to allow the removal of people from office are fairly standard among bodies in the public sector, as we will find when we consider the provisions relating to the Audit Commission. They are the kind of provisions that the party opposite put into many Bills passed by the House when it was in office.
	The noble Earl, Lord Howe, said that he welcomed our conversion to devolution, but then went on, I thought, to quibble about the speed at which we were doing it. There has been widespread debate and consultation, given that it is over a year since the proposal on foundation trusts was published. If we are going in the direction that the noble Earl favours, I hope that we will be able to produce solutions that help to get local freedoms to as many NHS trusts as possible as quickly as possible. That seemed to be the thrust of many of the contributions.
	Some of the arguments about a financial zero-sum game were a bit unconvincing. As I said, we are engaged, unlike previous administrations, in a 7.5 per cent year-on-year real terms increase in the NHS, which will be sustained for some time, with an increase of give or take approximately 25 per cent in public capital. The context in which we are introducing the changes is rather different from that of the past. In addition, all trusts will be paid on a fair basis under a nationally set tariff that will encourage efficiency gains under the same clinical standards. There will be a good deal more financial provision in the system while it undertakes the changes.
	I do not believe that the independent regulator can be bossed around by the Secretary of State, as was suggested. He is not subject to direction by the Secretary of State, and Clause 3 ensures that he or she acts in the best interests of the NHS. It is just not true that foundation trusts will exacerbate health inequalities. They will have the freedom to reshape services to fit their population's needs. Amendments made on Report in the other place provide protection against entryism, but if noble Lords have ideas for improving protection, we will be happy to discuss them.
	I was puzzled by the approach taken by the noble Lord, Lord Clement-Jones, to the governance provisions in the Bill. He seemed to want effective governance but was a bit reluctant to meet the cost. We recognise that good governance costs money, which is why we are providing resources for consultation and for the transition to foundation trust status, so that they do not come out of clinical care budgets. We do not think that the costs will break the NHS bank. First-wave applicants have been issued with guidance setting out the things that consultation should cover. After the passage of the Bill, all applicants will be required to carry out a full standard public consultation.
	The Bill reflects what has always been clear: trust status is for providers of NHS services. It does not provide for commissioners to make that transition. PCTs are new organisations, and we do not think that the time is right to propose further change.
	The noble Lord, Lord Clement-Jones, expressed concern about a private patient cap. It is provided for in Clause 15(2), which requires the independent regulator to cap private patient income. I assure Members that star ratings are not the sole basis for giving NHS foundation trust status; it will depend on wider considerations.
	I am grateful to my noble friend Lady Gould of Potternewton for her contribution and for her support in fighting the problem of sexually transmitted diseases. Such diseases are a serious problem, which is why the Government's sexual health and HIV strategy is in place and more money is being put into that area. It is not for us to instruct CHAI on how it does its job. I am sure that it will have heard my noble friend's concerns and will review how the NHS tackles this important area and acts on NICE guidance. That will be an important part of CHAI's review functions.
	I am grateful to the noble Baroness, Lady Cumberlege, for her good wishes. I shall try to stay upright throughout most of the proceedings of this House. Just to reassure her, as we understand it, under the European Convention on Human Rights, there is no basis for challenging the validity of votes in Parliament. Coming from her contribution, there seems to be a wish to remove the NHS from the grasp of politicians. We must bear in mind that taxpayers put huge sums of money into the NHS. I think that they expect elected politicians to account for that money to Parliament.
	The noble Lord, Lord Alderdice, seemed depressed about staff morale. I was pleased to hear the more reassuring experiences of my noble friend Lord Turnberg. His picture of staff morale seems to accord more with mine on visits to NHS facilities. Certainly, we are not involving ourselves in micro-management—quite the reverse. I hope that the noble Lord will accept our reassurances on that.
	The noble Baroness, Lady Masham, was concerned about a number of issues. It is worth bearing in mind that CHAI will be concerned—as are star ratings at present—with cleanliness in hospitals and hospital-spread infections. I am sure that CHAI will include those kinds of issues in future performance assessments. As regards the noble Baroness's question on specialised commissioning, the powers for that are set out under the NHS Act 1977. I shall write to her in more detail.
	I am grateful to my noble friend Lord Hunt for his perceptive and thoughtful speech. I want to compliment him on his work as a Minister when starting the work of changing NHS dentistry. I commend the Opposition Front Bench to study it carefully. I do not think that it always brought out the kind of points suggested. The noble Lord may have said that we overdosed on targets, but it is worth bearing in mind that it is these targets on access which give people what they want. Survey after survey of the public shows that they want shorter waiting times for access to services. Targets have played an important part in delivering that particular change.
	I reassure him and other noble Lords who raised the issue that there is no bar in this legislation to mental health trusts obtaining foundation trust status. Discussions are in hand with approximately 70 trusts in that particular area. It was just that acute and specialist trusts were further down the track in terms of first-wave applicants. A number of noble Lords, including my noble friend Lord Hunt, raised concerns about continuity. That is a concern and we are looking at how best to ensure that organisational stability during transition is maintained. We shall welcome the views of Members on strengthening those provisions if they have ideas in this area.
	A number of noble Lords, including my noble friend, spoke about Ministers keeping their sticky hands off and not interfering when matters start to go a little awry. I can reassure them that it is not my style to rush in to recalibrate the system when there is a little twitching at local level or in the media.
	The noble Viscount, Lord Bridgeman, raised a number of issues. I assure him that CHAI will inspect all diagnostic and treatment centres. My noble friend Lady Pitkeathley raised concerns about whether enough is being done on social care and the bridge with health care. As she said, the primary care features of the Bill are very important: 75 per cent of NHS budgets are now in the hands of PCTs.
	I understand too the concerns expressed by my noble friend and other noble Lords about patients' forums. We shall come back to this matter at a later stage. It is for foundation trusts to judge for themselves how best to involve public and patient interests, but no doubt many of them will consider building on some of the experiences of patients' forums.
	I welcome the contribution made by the noble Baroness, Lady Greengross, which will help us in the further work that we shall be undertaking. I can assure her that clinical governance and other areas of the kind she mentioned will be reviewed by CHAI in its inspection work.
	I shall not rush to secure my noble friend Lord Desai's vote for radical changes in the NHS, or I shall find myself quickly joining the club of former Ministers about which he seemed rather enthusiastic.
	I am grateful to the noble Baroness, Lady Hanham, for sharing with the House her experience as someone working at the local level and wrestling with the changes. These practical issues will help to inform some of our more detailed consideration.
	I listened attentively to the contribution of my noble friend Lord Harris. I am pleased that he said that he supports the Government and does not disagree with us too strongly.
	I can reassure the noble Baroness, Lady Finlay, that all NICE guidance will come within the ambit of CHAI. I should also like to assure her that this Bill is all about improving the lot of patients rather than providing a management distraction.
	I thank the noble Lord, Lord Colwyn, for his contribution and for his support for the changes to dental services. He has huge knowledge of this area and I shall write to him on some of the detailed points that he raised.
	The noble Lord, Lord Adebowale, has great experience of drug treatment and mental health. As I pointed out earlier, there will be no bar in the legislation on either mental health trusts or care trusts to achieving NHS foundation trust status. I think that it is simply a little further down the road.
	I have mentioned the contribution of the noble Lord, Lord Blackwell. I do not think that we are seeking to go down the path he thinks we ought to follow, rather we seek measured change and a loosening up of the NHS. I am extremely conscious of the effects of radicalism in some privatisation measures—transport comes to mind—where a little caution might have done us all good.
	Along with her colleague, Ann Parker, the noble Baroness, Lady Howarth of Breckland, has made a major contribution in setting up the National Care Standards Commission. We are all grateful for their work. I can assure her that none of that work will be lost, rather it will be built on. I should also like to assure her that the Bill retains the position of children's rights directors set up by the commission.
	I too enjoyed the perceptive contribution of my noble friend Lord Sawyer. I am glad that he is joining with us in breaking up the monolith. I thought that he was the only Member of the House to make the link with mutualism that runs through the ideas behind this Bill.
	My noble friend Lord Turnberg wants us to move swiftly on extending foundation trust status to as many trusts as possible. I hope that he can convince Members on the Benches opposite to help us in that regard, because it is what we want to do. I am sure that CHAI will take note of his thoughtful remarks on performance ratings. I can reassure him on teaching and research. Under Clause 14 an NHS foundation trust authorisation must authorise it and may require the trust to provide education and training and to carry out health-related research. I shall study his remarks in more detail and perhaps discuss them further.
	I am grateful for the helpful contribution of the noble Baroness, Lady Barker. I understand her concerns and I shall deal with them in more detail at a later stage. Following a thoughtful debate, I commend the Bill to the House.
	On Question, Bill read a second time, and committed to a Committee of the Whole House.

Supreme Court

Lord Lester of Herne Hill: rose to ask Her Majesty's Government how their proposals to create a supreme court of the United Kingdom and a judicial appointments commission will secure the independence of the judiciary.
	My Lords, the debate enables the House to discuss how the administration of justice may be enhanced in the light of the Government's proposals for reform. Judicial independence is, of course, not the only requirement for a proper system of justice but it is essential to the rule of law. I am grateful to the many eminent and learned noble Lords who have stayed to take part in this debate on a matter of great importance, not only to judges and lawyers but to everyone.
	We are fortunate to live in a democratic society governed under the rule of law, but changing social needs require changes to our governing system, including the judiciary. Reforms must not only be well designed, they must also be carefully implemented in a way that nurtures and sustains a judicial process that commands public confidence. It is especially difficult to accomplish this when judicial independence is undermined by senior Ministers, as has happened with the attacks by the Home Secretary on the judiciary, or when proposals are announced hurriedly without any prior discussion with the judges themselves.
	The sudden departure of the noble and learned Lord, Lord Irvine of Lairg, from the Government leaves a worryingly unbalanced Cabinet. He was a powerful counterweight to a populist Home Secretary whose defining characteristics include a marked dislike of the judiciary when it curbs the misuse of his public powers. We regretted the stubborn refusal of the noble and learned Lord, Lord Irvine, to recognise the need to make the reforms now proposed, but that does not diminish his achievements as Lord Chancellor, most notably the Human Rights Act.
	The departure of the noble and learned Lord, Lord Irvine, leaves behind a Government with no one of his stature, authority and sometimes awkward independence to act as an effective counterweight to the combined weight of the Prime Minister's Office, the Cabinet Office and the Home Office. It is a vacuum that cannot be filled merely by imposing a statutory duty on a Minister to promote judicial independence, a duty that should surely apply to the entire Government. In any event, it is essential for the judges to speak for themselves when it becomes necessary to protect the administration of justice.
	What matters more than any formal and unenforceable statutory duty is the culture of mutual confidence, trust and respect between the judiciary and the executive and between each branch of government and the public. However sensible the proposals for institutional reform may be, what matters at least as much are those chosen to make them work. The botched way in which the Government initially mishandled their proposed reforms has undoubtedly undermined public and judicial confidence in the reform proposals. It is therefore welcome news that the noble and learned Lord, Lord Woolf, has decided to continue to serve as Lord Chief Justice of England and Wales to seek to ensure that judicial independence will be secured and that the quality of our judicial system will be preserved and improved.
	The consultation papers do not refer to the role of the Attorney-General. To strengthen the rule of law, he should be entitled as of right to attend all meetings of the Cabinet and Cabinet Committees to advise authoritatively on matters of law and legal public policy. The Prime Minister might do well to follow Australia's example and end the convention excluding the Attorney-General from membership of the Cabinet. The Attorney-General is surely the appropriate Minister to be consulted about judicial appointments for England and Wales.
	We support the Government's proposals to create a judicial appointments commission; to replace the Law Lords with a supreme court of the entire United Kingdom; to create a more diverse judiciary; and to end government patronage in the appointment of senior counsel. We have campaigned for these reforms for many years, and we welcome the Government's recent conversion. It is surely right that a Cabinet Minister should not appoint judges and sit as a judge in the final court. As the noble and learned Lord, Lord Bingham of Cornhill, said:
	"The Law Lords are judges not legislators and do not belong to a House to whose business they can make only a slight contribution".
	We shall miss the Law Lords' contribution to our Committee work and to debates, but their role has become increasingly constrained by the need to avoid possible conflicts of interest. Their proper province is surely judicial rather than political. The judges must be consulted about issues of legal public policy, but they should not be legislators.
	Moving the supreme court to a suitable home will overcome the acute shortage of space that now prevents the Law Lords having sufficient support staff and the public having proper facilities. The needs of the senior judiciary and the public should no longer be cramped by the shortage of proper accommodation in this building.
	It is also surely right that the senior judiciary should be drawn from a more diverse pool of well qualified candidates than at present in terms of gender, ethnic spread and range of experience and practice. By "well qualified" I mean not only intellectually well qualified but well qualified by experience and personality to act independently and impartially.
	The quality of independence is well provided by judges drawn from the independent Bar, for the Bar is a profession of self-governing and inner-directed individuals, trained to be robustly independent. But the Bar still lacks diversity and it has no monopoly for providing potential judges with such qualities. Judges and barristers need to recognise that experience of advocacy is not a necessary condition for a good judge. The qualities needed can be well provided on the basis of wider professional experience beyond the Bar, including solicitors, those who have chaired tribunals or who have been distinguished academics and civil servants.
	Judicial independence involves the individual independence of a judge, reflected in security of tenure, and the institutional independence of the court over which the judge presides, embodied in the institutional relationships between the executive and legislative branches of government. This does not mean that a judge should be unaccountable, or that there should be no independent informed evaluation of the judge's performance. But it does mean that the institutional architecture must be well designed to appoint judges of proven experience, ability and independence, and to promote the culture of mutual confidence, trust and respect to which I have referred.
	I share the concern of the noble and learned Lord, Lord Woolf, that the proposed judicial appointments commission might be unduly influenced by politicians. As he has said:
	"If the Executive can influence who is on the appointments commission and who the commission appoints that is interfering with the judiciary".
	It may be desirable, for reasons of political legitimacy and parliamentary accountability, for a parliamentary Select Committee to be involved in some way and for the Prime Minister to recommend to the Sovereign appointments to the senior judiciary, but this must not mean that Ministers should be able to influence the process other than by accepting or rejecting the proposals of a genuinely independent commission. Ministers' discretionary powers should be strictly confined to ratification or rejection of nominations. We certainly would oppose politically partisan and oppressive confirmation proceedings of the kind operated in the United States.
	An independent judicial appointments commission should be responsible for making direct appointments at junior level and making recommendations at the more senior level.
	The way in which members of the commission are appointed is crucial. The commission need not be chaired by a judge and it must not be dominated by judges since that would lead to a form of judicial corporatism, but it needs to include a significant proportion of senior judges, and to consult the judiciary in its work. It must also be seen to be manifestly independent, and the criteria of procedures for appointment must be well designed and transparent.
	I would strongly oppose the suggestion in the consultation paper that the recommending body for appointing commission members should be chaired by the permanent secretary of the Department for Constitutional Affairs rather than someone wholly independent of the Government. The issue of budgetary and staffing control is important. In my view, the Supreme Court of the United Kingdom, like the High Court of Australia and the American federal judiciary, should control its own budget and be responsible for court staffing and services. There is a strong case for that to be done more generally. That is a controversial issue not explored in the consultation paper, but first raised many years ago by the noble and learned Lord, Lord Browne-Wilkinson.
	I look forward to the contributions to be made in the debate and to the Minister's reply.

Lord Borrie: My Lords, I confine myself to three points. The first is that the case for changing our system of judicial appointments was much stronger in the early part of the last century than it is now. Lord Chancellor Halsbury, who served in that office for a total of 16 years, made some disgraceful appointments, particularly MPs of doubtful quality, to be judges. Then there was the apparent convention in the early part of the last century that, when the office of Lord Chief Justice fell vacant, the current Attorney-General should be entitled to succeed. In 1922, the former Attorney-General Gordon Hewart was appointed Lord Chief Justice. He was to remain in that post for 18 years and was described by the reputable legal historian Professor Heuston as,
	"perhaps the worst Lord Chief Justice of England since the 17th century".
	Political appointments were common in England over a long period, and it is to the credit of more recent Lord Chancellors, including the last two—the noble and learned Lords, Lord Mackay of Clashfern and Lord Irvine of Lairg—that their appointments were impeccable and based solely on merit and high quality.
	My second point is that there remains a case today for change along the lines that the Government have proposed. The present system, in which the whole process of appointment is in the hands of a government Minister, has been abused in the past, is anomalous, and is increasingly inappropriate when judges have to adjudicate more and more on the lawfulness of the actions of the executive. Appointment by, or on the recommendation—perhaps depending on the grade of judge—of an independent, well-balanced judicial appointments commission of the kind proposed, with the commission itself appointed by patently independent persons, is surely the right way forward.
	The noble Lord, Lord Lester of Herne Hill, with whose remarks I largely agreed in their detail, is surely right to ask how that system will secure the independence of the judiciary. To my mind, appointment to the judiciary by, or on the recommendation of, such a commission, combined with a continuation of the very substantial security of tenure that High Court judges and, to a lesser extent, circuit judges enjoy, will be the key factors in ensuring judicial independence.
	My third point is that I welcome the Government's decision and desire to open up the possibility of appointment to candidates from a wider range of social background. However, the reassurance in paragraph 28 of the White Paper that the fundamental principle must be selection on merit is absolutely vital. At the moment, we have a situation in which about half the numbers of young people who become barristers or solicitors are women. Quite a reasonable proportion of minority ethnic groups has been joining the legal profession but, unfortunately, too many women and too many from those groups fall by the wayside before they have acquired the experience needed for appointment to the Bench.
	I feel sure that both the professions could do a great deal more to ensure that work arrangements are more flexible and family friendly, so that there will be a wider and diverse pool from which judges of the future can be selected. I am not sure that I fully understand the rather complex paragraphs 93 to 97 of the White Paper, which deal with how diversity can be achieved. My route, which I have suggested depends a great deal on the profession, will result in a more diverse judiciary than the appointment of younger people with limited experience of the law and of life, which seems to be suggested by the Government.

Lord Alexander of Weedon: My Lords, time is short. So I will say nothing by way of amplification and the reasons of Justice, the all-party law reform group which I chair, for believing that the time has come to create a supreme court of the United Kingdom separate from the House of Lords. Our reasons were in the evidence which several of us here, supported notably too by the noble and learned Lord, Lord Scarman, gave to the Royal Commission on House of Lords Reform three years ago.
	I want to focus essentially on the critical issue which the noble Lord, Lord Lester, highlighted, of the independence of the judiciary. I find myself in a quandary here. For 30 years, Justice has argued for an independent judicial advisory committee. Now—this is welcome—the Government say in their consultation paper:
	"The appointments system must be, and must be seen to be, independent of government. It must be transparent. It must be accountable. And also it must inspire public confidence".
	Amen to that. However, to this end I have two suggestions to the Government. First, like the noble Lord, Lord Lester, I do not think it right that a civil servant, however eminent, should chair the small group which makes recommendations for appointment to the commission. I think that it should be better if a judge chaired that group, or at any rate someone else of stature wholly independent of government.
	Secondly, and more importantly, I regard it as going fundamentally against the aim of independence to transfer the responsibility of the ultimate appointment from a Lord Chancellor who is by tradition a senior lawyer, acting independently of party, to a Secretary of State for Constitutional Affairs who may not be a lawyer, who may be ranked as the lowest member of the Cabinet, who may have further ambitions and see the role as a ministerial stepping stone, and who may not regard the separation of powers and the integrity of the judiciary as critical to a healthy democracy. I believe that there should be an advisory committee, but advisory to a Lord Chancellor who has the detachment and avoids putting the appointments near the cockpit of party politics.
	So I would like to see the post of Lord Chancellor retained, without his being a Minister, responsible for the most important appointments and accountable to this House and to the House of Commons Select Committee on the Lord Chancellor's Department. In this way the aim of securing independence, quality and accountability and appropriate diversity would continue to be achieved.
	I would not find a trade-off acceptable between the present arrangements and an independent commission which ultimately led to appointments being made by a very political Minister. We must remember that this is different from any other department of state. All other departments of state are ultimately accountable to the Government. The law is separate. It is a separate branch of the constitution, accountable to the people. I believe that that tradition should be preserved, and the mechanism of adapting the Lord Chancellor's role is a simple one. I have written to the current Lord Chancellor and Secretary of State for Constitutional Affairs about it. I know that the Minister has seen the letter. I would urge that the Government give it the strongest consideration—in which case I would rejoice to see an independent appointments commission.

Earl Russell: My Lords, 10 years ago in an Unstarred Question Nancy Seear remarked, "If my party should abandon the independence of the judiciary, I would promptly abandon my party". At the time of speaking she had been a member of the party for 60 years. It made the mind boggle. But if she had done so, she would have gone out for the principle for which she came in. She joined the party in the week in which Hitler dissolved the Reichstag and took the power to legislate by decree. So the principle that the law should not be under the control of the executive is constant.
	But when we think about a great philosophical principle, I think we miss the sheer raw emotion that there is usually in a confrontation about judicial independence. I was looking this afternoon at Shakespeare's unfortunately apocryphal description of the alleged confrontation between the newly minted King Henry V and the Lord Chief Justice. The raw hurt of the executive comes over from that:
	"How might a prince of my great hopes forget
	So great indignities you laid upon me?
	What! rate, rebuke, and roughly send to prison
	The immediate heir of England! Was this easy?
	May this be wash'd in Lethe, and forgotten?"
	That scene shows a need for courage on one side and magnanimity on the other which is rarely met outside fiction. It is a lot more difficult in the real world. So we need some sort of handrail, a banister, for people to clutch hold of because we have been reminded recently that, when in disgrace with fortune in men's eyes, one is intensely lonely. There must be someone to whom one can turn. Clearly it cannot be a traditional Lord Chancellor. I agree with my noble friend Lord Lester that we cannot go back. But equally clearly it cannot be someone who is simply an ordinary political Minister of the Crown. I think that there are a lot of places we can turn.
	One of the things we need to think about in all this is the position of Parliament. People constantly remark—as I believe the noble Lord, Lord Borrie, did tonight—that judges are becoming involved in more and more issues of control of the executive. That, frankly, is because we are failing to do it ourselves. The place where there ought to be a real rousing reception to any attempt to interfere with the independence of a judge is Parliament. It is in Parliament that failure is happening.
	I make a few small points. I do not think that all the members of the judicial appointments commission should be Crown appointments. The legal profession has many people capable of doing that sort of thing and their talent should be used. I hope that the responsibility for the care of our public records will remain in judicial hands. I am interested in the remarks of my noble friend Lord Lester about the Attorney-General which I think have potential. But he cannot do it on his own. In the end this responsibility must fall on us, but are we up to it, and have we the bottle to take it? I am afraid that I have my doubts, but we must try.

Lord Ackner: My Lords, four minutes provide no time for introductory averments. I take but one point—a preliminary point. Has the Secretary of State for Constitutional Affairs, or any other Minister, sufficient stature to ensure the continued independence of the judiciary?
	Much reliance was placed on the support of the noble and learned Lord, Lord Bingham of Cornhill, on the need for a supreme court quite independent from the House of Lords. Giving evidence as Lord Chief Justice on 13th May 1999 to the Royal Commission, he said:
	"We have no doubt that this dual role [that of the Lord Chancellor as head of the judiciary and as Cabinet Minister responsible for the administration of justice] has proved invaluable in maintaining the independence of the judiciary in England and Wales and we have considerable anxiety that any other arrangements would result, in time, in the encroachment of the Executive Government into the proper sphere of judicial independence essential in a democratic society".
	I interpose there to say that that encroachment has already happened. See, for example, the sentencing provisions of the Criminal Justice Bill, supported by the noble and learned Lord, Lord Falconer, when a Minister in the Home Office and now no doubt in his dual capacity. Those provisions will of course be debated by your Lordships next month.
	Lord Hailsham, a pre-eminent Lord Chancellor of post-war years, in a lecture given in 1989 observed that the Lord Chancellor's essential function was being,
	"in the business of defending and preserving the independence and the integrity of the judiciary. If he does it well, then he is a good Lord Chancellor whatever his other defects. If he does it ill, whatever his other qualities, he is not".
	Noble Lords may say that everyone supports judicial independence. It is, after all, the judges and the judges alone who stand between the power of the state and the freedom of the individual under the law, so what is all the fuss about? But does everyone support judicial independence? That very question was answered by Lord Hailsham in the selfsame lecture in these terms:
	"Certainly not the public or the back-benchers in the House of Commons, who constantly revile, frequently from inconsistent stand points, individual judges on particular decisions, or what they imagine to be judicial qualities, and daily demand that individual judges be directed or rebuked (presumably by the Executive Government) to move in this direction or that or even that they should be removed from office. Certainly not"—
	this part I emphasise—
	"the Opposition, whatever party happens to be on the Speaker's left. Certainly not Party conferences of any hue. And least of all, I assure you, individual Members of the Cabinet whose Departmental interests from time to time basically conflict, not only with the view of the judiciary, where they are entitled to differ, but in the provision of the means necessary to enable the courts to discharge their functions".
	It has not so far been suggested that the chief or essential function of the Secretary of State is to preserve or defend the judiciary. Until that is stipulated for in statute, the answer to the preliminary question that I have raised must certainly be no.

Lord Brightman: My Lords, the Question before your Lordships relates not only to a judicial appointments commission, but also to the creation of a supreme court of the United Kingdom. That appears to me inevitably to raise a very important issue: whether the time has come to hive off the judicial functions of this House, and presumably bring to an end the convention of making Law Lords ex officio life Members of this House. I declare an interest as a long-retired Law Lord.
	There are two preliminary questions to be asked. The first is whether the integrity of the judiciary is compromised by the presence of Law Lords on these Benches. The second is, if not, whether a sufficient contribution is made by active and retired Law Lords to justify their being accepted as ex officio Members of this House. I have nothing to say on the first question, except that I should be horrified if my own integrity as a judge had been at any time at risk because I joined in the legislative and other non-judicial work of your Lordships.
	On the second question, the contribution made by Law Lords to the non-judicial work of this House, I suggest that there are four pieces of information which it would be useful to have if they can be extracted with the aid of a computer. First, how many amendments to a Bill of a substantial nature have been tabled by Law Lords over, say, the past 10 years and accepted by the Government without a Division? Secondly, how many drafting amendments have been tabled by Law Lords over a similar period and accepted without a Division? Thirdly, how many places on committees have been filled by Law Lords over a similar period? Fourthly, how many committees have been chaired by Law Lords over a similar period?
	I have endeavoured to do a little research on my own. There is now a useful publication issued by the Information Office, rather nicely entitled Who does what in The Lords. This tells me that as at 5th March this year, 12 places on committees were occupied by Law Lords. I have also ascertained, by consulting DOD, that one particular Law Lord in his time acted as chairman of no fewer than nine Select Committees. I have no doubt that research will throw up similar examples.
	If the information I have outlined is obtainable, I think that we should have a fair idea of whether the presence of active and retired Law Lords in this House is justified. Government would be able to see what price would have to be paid for dismissing Law Lords as ex officio Members of this House and decide whether that price is acceptable. If the present association of the legislature and judiciary is to be maintained, as I sincerely hope it will be, I think that it must be proved not only that judicial integrity is not endangered, but also that a worthwhile contribution is made by the Law Lords to justify their having the privilege of sitting here ex officio.

Baroness Kennedy of The Shaws: My Lords, like the noble Lords, Lord Lester and Lord Alexander, I was one of the lawyers who gave evidence to the Wakeham commission that the time had come to reform the role of the Lord Chancellor. Although the press have suggested that this constitutional reform has come from left field, in legal circles it has generally been accepted for a very long time that the traditional role of the Lord Chancellor had become untenable and that the time had come to create a supreme court.
	I was most forcefully struck by the anomaly when the president of the supreme court of Russia came to London to visit our courts and to meet our senior judiciary. As chair of the British Council, I was given the role of accompanying him on that visit. The British Council had been engaged in assisting a programme of law reform in Russia, including the drafting of legislation to underpin the independence of the judiciary from the state.
	As chair of the British Council, I went with Justice Lebedev to meet the Lord Chancellor. On the way, he and I had a lively discussion about the importance of an independent judiciary and how crucial it was to a vibrant democracy. We discussed the role that the judges play in a contemporary legal system, protecting the rights of citizens and providing a control function by determining the lawfulness of government actions. He explained how hard it was to persuade the Russian public, after years of political control, that the judges really were independent and that they could be trusted. But he then with a twinkle asked me to explain how our system worked, with our Lord Chancellor wearing three hats. I have to say that I rather wickedly in return suggested that he ask the Lord Chancellor.
	When we went in to see the noble and learned Lord, Lord Irvine, there was the giving of a gift of a delightful samovar, which I am sure appears on his gift list in official bulletins. He asked how it came about that the Lord Chancellor could fulfil all those conflicting roles. The noble and learned Lord, Lord Irvine, gave a very convoluted reply which did not help given that it had to be translated. The explanation was all about tradition and Chinese walls, all of which sounded half-baked to a reform-minded Russian, who would be meeting senior judges from Czechoslovakia and other countries that wanted to apply to belong to the Council of Europe, all of whom were seeking to make their judiciary independent.
	The time had undoubtedly come for reform. Indeed, many of us had tried to persuade the noble Lord, Lord Irvine, that he should reform himself but our advocacy was not good enough. All that was needed was a decision by him not to sit again as a judge and the creation of an independent judicial appointments commission. Of course, if he had been really reform-minded he could have persuaded this House to appoint its own speaker. If the noble and learned Lord, Lord Irvine, had made those reforms the role of Lord Chancellor could have remained. It is important to have someone in the Cabinet who speaks for justice, for law and for the judges as a crucial counterweight to the purely political considerations that can press upon other Ministers.
	I want to echo the concerns of the noble Lord, Lord Alexander, about having a Secretary of State who may not take the long view. The Lord Chancellor's role has always transcended the political. It has a constitutional function. The Lord Chancellor is a guardian of the unwritten constitution; he became the guardian of human rights; and he protects the judges. I am anxious, in changing the role, that we ensure that the function does not become one that is purely political with the risk of neglecting those precious checks on the executive.
	Like many others here, I am pleased with the general thrust of these reforms. I think that an appointments commission will help to create a much more diverse judiciary. I think that the creation of a supreme court will be a great moment in our constitutional history. Unlike the noble and learned Lord, Lord Brightman, I do not think that an active judge should participate in the legislature. I think that we benefit from having many retired judges in the House and I hope that that may continue.
	My lingering concern is that the empire-building impulses of the Home Office machine and the short-term instincts of some politicians will mean that the long constitutional view will not be taken. A judicial appointments commission should not have any political interference. It should be independent; independent of the Prime Minister and independent of the Secretary of State. I echo what has been said by others about the importance of that independence. When we have all given our voice to the reforms, we did not imagine that it would mean the passing of appointments from the Lord Chancellor to the Prime Minister. I think in our modern world that that is unacceptable. Otherwise, I congratulate the Government on their boldness, but I ask them to consider the importance of our constitutional arrangements.

Lord Norton of Louth: My Lords, I congratulate the noble Lord, Lord Lester of Herne Hill, on raising this important question this evening.
	I have a simple point to make. We need far greater clarity as to what it is that we are discussing. The consultation papers make it clear that the most substantial argument advanced by the Government in support of their proposals is that of ensuring the independence of the judiciary. I quote from the foreword written by the noble and learned Lord, Lord Falconer of Thoroton, to the consultation paper entitled Constitutional reform: A Supreme Court for the United Kingdom, in which he refers to calls for the creation of a Supreme Court which separates the highest court of appeal from the second House of Parliament. He states:
	"The Government believes that in so doing they will reflect and enhance the independence of the judiciary from both the legislature and the executive".
	In the very next paragraph the noble and learned Lord declares:
	"The decision does not imply any dissatisfaction with the performance of the House of Lords as the highest Court of Law. On the contrary its judges have conducted themselves with the utmost integrity and independence".
	So we have Law Lords who are independent but who have to be removed from the second Chamber in order to demonstrate their independence. Why? The argument is one of perception. I can see the argument involved, but there is a confusion as to the very concept of independence. The first reference by the noble and learned Lord, Lord Falconer, is to independence in the sense of physical detachment. The second reference is to the capacity to exercise a judgment free of influence by others; in this case, other Peers and members of the executive.
	If the existing Law Lords can exercise judgment without being swayed by others, what is the point of removing them from the second Chamber? Separation will not, as the Government claim, enhance the capacity of judges to exercise judgments independent of others; it can only do that if there is some lack of detached judgment, and the noble and learned Lord clearly does not believe that there is. We are not in fact talking about independence but how people see independence. If there is a perception that does not accord with the reality—a misperception conceded in effect by the noble and learned Lord—one has two options. One can accept the misperception and undertake change in order to ensure that there is a better fit between practice and perception, or one can seek to correct the misperception.
	The Government are pursuing the first option. I think they have to make the case for doing so. They have asserted the case—and there are external pressures—but, given that there is an alternative, they have to argue it more convincingly. The same applies to all those who argue the case for a supreme court.
	Given that the focus of the Government is on perceptions, it is all the more surprising that they argue for the involvement of Ministers in the future appointment of judges. The case is based on existing practice and constitutional principles. To date, much has rested on the Lord Chancellor, who because of his judicial capacity is a somewhat detached member of the Government. In future—as my noble friend Lord Alexander of Weedon has said—the Secretary of State for Constitutional Affairs, like the Prime Minister, need not be a lawyer or anyone with any great knowledge of the judicial process. How, then, does one avoid the perception of possible political interference?
	The Government's proposals enter far more complex territory than is acknowledged in the consultation papers, perhaps reflecting the haste in which the proposals were generated. The consultation paper also raises a major point of principle affecting your Lordships' House in proposing, in the name of independence, that existing Law Lords—Members of this House—be barred from membership of the House for the duration of their tenure of the Supreme Court. We need to consider that novel constitutional proposal separately and urgently.

Lord Lloyd of Berwick: My Lords, I am more than glad to follow the noble Lord, Lord Norton, because I find myself in complete agreement with every single word which he has said.
	Two main themes run through these papers. The first is the Government's belief that the presence of the Law Lords as Members of this House in some way breaches the so-called separation of powers. Secondly, there is the emphasis placed by the Government—and rightly placed—on judicial independence. Thus, in the supreme court paper it is said that the removal of the Law Lords from the House of Lords would "emphasise and enhance" their independence. In the judicial appointments paper it is said that the new commission will "bolster and guarantee" judicial independence.
	The present debate is concerned entirely with the second of those themes—the independence theme. In passing, I should like to say that the first theme is based in my opinion on a complete misunderstanding of the separation of powers as it applies in the context of an unwritten constitution. But that is a debate for another day.
	I turn to judicial independence. The supreme court paper applies only of course to the 12 existing Law Lords and their successors. It does not affect the rest of the higher judiciary in any way. Yet it is accepted in the paper, and accepted so far as I know everywhere, that the Law Lords have conducted themselves—and here is the quotation to which the noble Lord, Lord Norton, drew attention,
	"with the utmost integrity and independence",
	and that they are,
	"wisely and rightly admired, both nationally and internationally".
	That being so, I am at a loss to understand what the Law Lords have to gain in the way of independence—this is the very point of the noble Lord, Lord Norton—by being moved at great and at continuing expense to some new premises.
	I accept that it may look untidy for the highest court of the land to sit as an appellate committee in this House. The reason, of course, lies far back in our history. I accept also that appearances matter, but appearances are not everything—not even in this Administration. To me, it does not make sense—indeed, it is the merest pedantry—to argue that the Law Lords should be moved to some other building. That would deprive this House and the country of the views of the Lord Chief Justice, and of judges of the eminence of the noble and learned Lords, Lord Wilberforce and Lord Scarman, and many others whom I could mention, just because it would make the Law Lords seem—I emphasise the word "seem"—to be more independent.
	I turn to the other paper, where it is said in paragraph 22 that the selection of the judges by the Lord Chancellor as a member of the Cabinet is a potential source of patronage over the judiciary and is quite out of place in a modern democratic society. Those are fine words, but let us read on a few paragraphs. What do the Government suggest should be put in the Lord Chancellor's place? Who, in the Government's view, is to have the final say on making recommendations for judicial appointments? Who is to determine—sinister words—overall policy in relation to judicial appointments? None other than the Secretary of State—another member of the Government.
	It is said that that is necessary because of the constitutional convention that the Queen always acts on the advice of Ministers. Quite right, but so she does when she acts on the advice of her Lord Chancellor. The Government cannot have it both ways. If it is a constitutional affront for the Lord Chancellor to select the judges, so also it is a constitutional affront for the Secretary of State to select the judges. Here I agree entirely with what was said by the noble Lord, Lord Alexander, and the noble Baroness. Indeed, it might be said to be a greater affront because whereas the Lord Chancellor—and not least the noble and learned Lord, Lord Irvine of Lairg—by virtue of his higher office and experience of the law has traditionally protected the independence of judges, the Secretary of State might be—well—anybody.
	As for the new judicial appointments commission, it is pure window-dressing since the Secretary of State has the final say and can reject the recommendations if he does not like them. In any event, we already have a Commission for Judicial Appointments, as recommended by Sir Leonard Peach. Why do we need two? These papers are full of holes, and the only, and most charitable, explanation is that given by the noble Lord, Lord Norton—they were prepared in too much of a hurry.

Lord Brightman: My Lords, before the noble and learned Lord sits down, I may have misunderstood what he was saying. The Question, as tabled, relates to two proposals—in the plural—to create a supreme court of the United Kingdom and a judicial appointments commission. Therefore, if there was any thought among your Lordships that I was speaking out of turn when I referred to the dismissal of the Law Lords from the House of Lords, I respectfully suggest to your Lordships that I was absolutely within the terms of the Question.

Lord Brennan: My Lords, in 1867 Bagehot declared that the supreme court of English people ought to be a great conspicuous tribunal, it ought to bring our law into unity and it ought not to be hidden beneath the robes of a legislative assembly. I agree with those words. The time has come at the beginning of this century for a supreme court in this country. I believe we shall debate the reasons for that at length when the necessary legislation comes before us, but I highlight two factors.
	The growth of public law, European law and human rights law creates a role for a supreme court much more in the public eye and much more sensitive than it has been in times past. A court of that kind should be seen to be independent.
	Secondly, the fact is—I regret to have to say this; it is a personal view—in times of a strong government and a weak Parliament that has not effective committee control of the executive, a supreme court has a special symbolic role in the community as the defender of citizens.
	To preserve that role, Bagehot's words embrace three concepts. The first is independence. I agree entirely with the words of the noble Lord, Lord Alexander. There should be a Minister with the specific responsibility to preserve the independence of the judiciary, perhaps even written into the statute that creates the supreme court. With that responsibility, it is difficult to see how even the most base of politicians could determine to appoint people who lacked merit. The statutory responsibility should prevent it.
	So, first, there must be independence and a Minister to protect the judiciary from attack where necessary. Secondly, the court must have stature. What I am about to say may be controversial. It should consist of 12, 15 or whatever number best represents England, Wales, Scotland and Northern Ireland as constituent parts of the nation. It should be divided into panels; I am not suggesting 12 to 15 as the sitting panel.
	The age should be kept to the present limit. If my noble friends on this side of the House and noble Lords on the Cross Benches will forgive me, I am entirely against the supreme court of our nation being staffed by retired judges—not because I do not respect their abilities, but I think that it is a simple technique of saving money by the Treasury. I cannot imagine any other reason for suggesting age 80 as the age to sit.
	Thirdly, the composition must be correct—not prescribed but at least sought. Is there a public lawyer by experience on the present panel? Is there an expert in European law? Is there anybody with profound understanding of the criminal law? The composition of the court should reflect those specialities.
	Lastly, the judges should not be used to conduct major public inquiries. They are servants of the nation in the supreme court. There must be separation of powers. Judges are not legislators. That simple constitutional proposition cannot be gainsaid. We can have the advantage of the Lord Chief Justice and others making public speeches as required. Supreme court judges should be given peerages and attend this House after their retirement to contribute to it. But, for the community in which we live, the time has come for a supreme court to be seen to represent the legal interests of the people in the nation, to provide the protective balance between them and Parliament, where necessary, and certainly between them and the executive.

Lord Taylor of Warwick: My Lords, in 1972 the popular Jamaican singer Johnny Nash had a hit record with a song called, "There Are More Questions Than Answers". I am not aware that, when he wrote the song, he had in mind the creation of a supreme court and a judicial appointments commission. But the song's title fairly sums up how I feel about the Government's consultation papers, which contain no fewer than 72 questions.
	Noble Lords have mentioned some very pertinent questions, which I shall not repeat now. Because of time limits, I will focus on a particular aspect of the proposals: the desire to make the judiciary more diverse. But the question is how diversity will be achieved. I fully support the comments made by the noble Lords, Lord Lester of Herne Hill and Lord Borrie.
	Sadly, a woman has never been appointed to our final Court of Appeal. There has never been a black or ethnic minority judge appointed to the High Court in England and Wales. We are familiar with the expression "glass ceiling" when describing the obstacles often faced by professional women. The phrase "concrete ceiling" is one that is commonly used by the black community to describe its barriers to progress. Clearly, the judiciary must become more diverse in order to carry the confidence of the wider community.
	The business sector in Britain has been enriched by diversity, so it is not inevitable that a more diverse judiciary would result in lower standards. It will, however, if tokenism is used to enforce diversity. The answer is to create more equality of opportunity. The legal profession itself must, for example, look at whether the terms and conditions of judicial office are "family friendly" and whether it allows sufficiently for the needs of lawyers who need a career break after having children. Black and minority ethnic law students with the same qualifications as their white counterparts still find it more difficult to obtain pupilages and articles.
	I support the rationale behind these proposals, but the devil is in the detail. There are more questions than answers. Johnny Nash ends his hit song with the line, "The more I find out, the less I know". I hope that is not an omen for these reforms.
	The public needs a modern legal system that builds on its current independence and quality. These proposals bring many questions. I just hope they provide the right answers.

Lord Hobhouse of Woodborough: My Lords, I am most grateful for the opportunity and justification to make some very brief observations upon the important topic of independence. At the outset, I would like to say that I do not wish to detract from anything that the noble Lord, Lord Brennan, has just said, with most of which I agreed. The views that I will express are my own. I do not speak on behalf of my colleagues.
	The remarkable feature of both these papers and the ministerial statements which accompanied them is that they unstintingly acknowledge the merits and success of the current systems, the role of the Lord Chancellor and the dedicated staff of the Lord Chancellor's Department. The proposals for change are sought to be justified on doctrinal grounds, which I suggest are fundamentally flawed.
	For the supreme court, the Minister tells us that:
	"The time has come to take the final court of appeal out of the Legislature",
	and that,
	"the time has come to establish a new court as a body separate from Parliament."
	As regards judicial appointments, we are told that it is no longer acceptable that they be solely in the hands of "a Government Minister"—an expression repetitively used whenever it is wished to refer to the office of Lord Chancellor—and the paper calls for a judiciary which is more "reflective" or "representative" of society. This is an aspiration which would run directly counter to the current admirable and non-discriminatory, merit-based criteria set out at Paragraphs 7 to 9 of the paper.
	Neither the separation of powers, as opposed to the principle of judicial independence, nor the concept of a "representative" judiciary, are part of our constitution nor have they ever been. Nor is it right to describe the office of Lord Chancellor merely as that of a "Government Minister". The theory of the separation of powers was a primarily French invention. It has never been part of the British constitution or the "Westminster model". If it were, the executive, including the Prime Minister, would have to be removed from the House of Commons. In contrast, the principle of judicial independence from the executive stems from the Glorious Revolution. The theory of the separation of powers should, at most, be seen as one possible means to that end.
	The independence from the executive of the Appellate Committee is, in fact, enhanced by its being sheltered under the wing of your Lordships' House. Neither the serving Law Lords nor, I suspect, your Lordships feel threatened in any way by their presence within these walls. There are strong practical arguments in favour of our moving out and having our own home, but the paper does not face up to the implications of providing complete and real independence for the new court. There will be considerable additional costs initially and year-on-year. Your Lordships should be vigilant to see that, when the actual proposals are published, they do not put the truly independent operation of the new court in jeopardy or undermine its standing.
	Finally and briefly, I turn to the appointment of judges. In the long run, the risks here are potentially more serious. I will simplify. The key to success at present has been the office of Lord Chancellor and the independence and expertise of the Lord Chancellor's Department, separate from the rest of Whitehall. The Lord Chancellor is not just a Minister; he sits in the House of Lords. He has nowadays no further political ambitions. He has taken the judicial oath and accepted the role as head of an independent judiciary. It is not necessary or appropriate that he ever sit as a judge, but he understands well that judicial appointments are part of his judicial functions. The criteria that he has published are wholly admirable. Who better to be the defender of judicial independence than the Lord Chancellor? The present proposals include abolishing the independent post and department, introducing contradictory criteria of social engineering and even suggest that some Minister should be accountable to the House of Commons for individual appointments.
	I conclude by saying that I have no personal interest in the subject matter of the debate, as I am not looking for further judicial preferment and expect to retire long before any supreme court comes into existence.

Lord Cooke of Thorndon: My Lords, I quote:
	"Our judiciary enjoy the highest international standing. The Government wants to ensure that the way in which they are selected is as well regarded".
	So runs the consultation paper. There is an implicit dichotomy in that. The suggestion appears to be that the rest of the world admires the quality, integrity and independence of the judges of England and Wales, but questions the administrative arrangements that produced such a judiciary. I do not believe that the world as a whole draws any such distinction. It is the product, not the process, that matters in the world's eyes.
	That the judiciary here is, at the present day, independent of political influence is axiomatic. In the interests of time, I will not labour the point, beyond mentioning one current example. When the government of the day recognised that a truly impartial inquiry was required into a tragedy of intense public concern, to whom did they naturally turn? A Law Lord.
	A change to a judicial appointments commission will add nothing to the practical independence of the judiciary. On the contrary, it may result in quotas, trade-offs and uninspired appointments. It is linked with an unconsulted proposal to destroy the office of Lord Chancellor; yet I believe that the rest of the world sees a non-Gilbertian truth in Gilbert's line:
	"And I, my Lords, embody the Law".
	Certainly, in my years as a barrister and judge in New Zealand, we deeply appreciated the visits of such Lord Chancellors as Jowitt, Kilmuir, Gardiner, Hailsham, Mackay. We envied, and realised how significant for the rule of law it was that they had the ability to speak for the judiciary in Cabinet. Diversity in judicial appointments is good, but it increases naturally. It will not best come as part of a tearing up of a unique history.
	A convention had been developing that the Lord Chancellor would no longer sit as a judge. Nothing more was required to modernise the United Kingdom system without sacrificing its distinctive merits. To remove the Law Lords from the House would add not a whit to their independence, while somewhat downgrading them and sacrificing the reciprocal advantages of their ability to take an appropriate part in the work of this place. Thus, two current and three former Lords of Appeal have contributed to the debate. Their right to contribute should not be thrown away.

Lord Goodhart: My Lords, I am grateful to my noble friend Lord Lester of Herne Hill for introducing the debate. Although the time for individual speeches has been short, the quality of the speeches has made this something of an advertisement for short time limits. We are discussing two changes of immense constitutional importance proposed by the Government, which have been advocated by these Benches for years. Naturally, we support them in principle. The first change is the creation of a new supreme court and the transfer to it of the present jurisdiction and membership of the Appellate Committee of your Lordships' House.
	Outside your Lordships' House I believe that this change will be relatively non-controversial. It will not alter the nature of the work done by the highest court in the United Kingdom, nor will it alter the identity of the people who do it. It is nearly 200 years since it was finally accepted that Members of your Lordships' House could not exercise judicial functions unless they were also, or had been, holders of high judicial office. We are now moving towards a convention that serving Lords of Appeal in Ordinary do not speak in debates in your Lordships' House, with limited exceptions: for example, the role of the Law Lord—in this case, the noble and learned Lord, Lord Scott of Foscote—who chairs Sub-Committee E of the European Union Committee, in introducing debates on reports of that sub-committee.
	The creation of a new supreme court separate from your Lordships' House would therefore do no more than put an end to what is now an historic anomaly. In addition, it would give the Supreme Court the opportunity for the proper housing and facilities which it has obviously required for many years. I accept that there is a strong case for having as a Member of your Lordships' House someone who can speak for the judiciary. The noble and learned Lord, Lord Woolf, has done that powerfully on two recent occasions, but it does not mean that serving members of the Supreme Court should also be simultaneously Members of your Lordships' House. That role is better played by the Lord Chief Justice and the holders of the corresponding offices in Scotland and Northern Ireland.
	The more controversial issue has been the transfer of power to recommend judges for appointment from the Lord Chancellor to the proposed judicial appointments commission. We are, of course, fortunate in our present judiciary. Appointments made by recent Lord Chancellors have been of very high quality. As the noble Lord, Lord Borrie, pointed out, in the past political support for the government of the day has been a good way of getting on the Bench. Indeed, Lord Halsbury was explicit about it. If the office is retained, we cannot guarantee that future Lord Chancellors would always be as impartial as recent ones have been. This is particularly so given the increasing constitutional role of the judiciary through the development of judicial review and through the Human Rights Act. The temptation to appoint judges who are not potential troublemakers might become irresistible to some future Lord Chancellor.
	There are criticisms of the way in which the process operates now. While undoubtedly it selects judges of real merit, it may also overlook other people of at least equal merit. So we welcome the transfer of the power to make those appointments to the judicial appointments commission. If the Government, through the Prime Minister or the Secretary of State for Constitutional Affairs, retains any role in the appointment of the higher judiciary—we think there are strong arguments for why they should not do so—that role should be limited to approving or rejecting a single name proposed by the judicial appointments commission and, indeed, giving reasons to the commission in case of rejection of that name.
	When legislation is introduced to give effect to the Government's proposals, as we assume will happen in the next Session of Parliament, it will need to be watched very carefully to ensure that the independence of the judiciary is not only preserved but strengthened. That will mean that the high reputation of British justice will be maintained for the future.

Lord Kingsland: My Lords, I should like to speculate briefly on the motives of the Government in introducing these proposals.
	Their introduction has been rather sudden. Indeed, throughout his time as Lord Chancellor, the noble and learned Lord, Lord Irvine of Lairg, repeatedly opposed either the creation of an independent supreme court or the establishment of a judicial appointments commission.
	Can it be that overnight there is evidence that judges have become corrupt, or susceptible to political interference, or have in some way fallen below the intellectual standard that we rightly expect of them? It seems not, because in his speech to your Lordships' House on 14th July, the noble and learned Lord the Lord Chancellor said that:
	"We currently have judges of complete independence, probity, and very high ability. They are admired the world over".—[Official Report, 14/7/03; col. 630.]
	Could it be that the inspired and sustained campaign fought over many years by the noble Lord, Lord Lester, has led to the Damascene conversion of the Government to these two new policy proposals, some 50 years after the Government ratified the European Convention on Human Rights? I have the highest admiration for the quality of the advocacy of the noble Lord, Lord Lester, but I have to say that I think not.
	I want to suggest that the real reason why the Government want to make these changes is because the decisions made by the judiciary in the realm of public law are increasingly inconvenient to them. The judges are becoming a nuisance, and especially an impediment to the populist programme of the Home Office. Yet all the judges are doing is implementing a law which the Government introduced in 1998; that is, the Human Rights Act.
	As—dare I say—many of us pointed out during the passage of that Bill, there was a real danger that the consequences of it would be the political over-exposure of the judges. So I suggest that the motive that lies behind these changes is to weaken the judges' role in our constitutional arrangements in other respects: by removing the Lord Chancellor from the Cabinet and the Lords of Appeal in Ordinary from the legislature.
	Your Lordships' House suffers in a further way because, by removing the Lord Chancellor from the Cabinet, your Lordships' representation in the Cabinet is reduced from two to one.
	Moreover, the Minister who will succeed the noble and learned Lord the Lord Chancellor in his judicial responsibilities will be a Secretary of State sitting in another place who, more likely than not, will not be a lawyer. So what price the separation of powers if that Minister has the final word over judicial appointments?
	We are told by the Government that they seek a more representative judiciary. I do hope that what the more representative judiciary will represent will not be the political mood of the day.

Lord Filkin: My Lords, I thank the noble Lord, Lord Lester, for introducing the debate. This is an issue of great importance to our constitution and to the House and it is good that we should have an early opportunity to debate it even before consultations are completed and before any draft legislation is brought before the House. I also thank all noble and noble and learned Lords who have spoken on these issues of considerable importance.
	At the risk of slightly over-emphasising a dichotomy, it seems to me that the debate was split between those who believe that changes are necessary in terms of both the supreme court and the judicial appointments commission but that the proposals are not yet quite perfect, and those who argued for the status quo. I shall not put everyone into exact categories.
	The noble Lord, Lord Lester, started by signalling that he supported the main element of the proposals. He spoke also, as did many others, about the importance of diversity as an element of these proposals. I thank him for that.
	He started an argumentation, which was picked up by a number of other speakers, that there is a worry that the fact that the Lord Chancellor will be replaced by a Secretary of State in itself risked weakening judicial independence in some way. It is an important issue to ventilate and the debate has started that process. My initial response is that we will undoubtedly come back to these matters.
	Along with the noble Baroness, Lady Kennedy, and my noble friend Lord Brennan, the noble Lord, Lord Borrie, essentially affirmed the case for change on both counts. While there has been a wonderful historical evolution of our constitution, no one would dream of designing a supreme court as part of the legislature. Why should we therefore continue with such a system when it is quite clear that it involves some risks in terms of JR and ECHR?
	More importantly, it does not help to establish the importance and independence of the judiciary. If one were to ask average members of the public what is the supreme court in the land, they would say it was the House of Lords. If you asked them to describe how it operated, they would probably say that most of us were involved in the process in some way. They see us as politicians and they do not hold us in very great respect.
	You may say that members of the public are foolish and ignorant to be confused in that way. On the other hand, if we had a supreme court that was quite clearly independent of the legislature, the authority of that court would be enhanced. Its visibility would be apparent and clear and the public would increasingly see it as a bulwark of their freedoms, their rights and their independence. That, of course, is how it has operated, but that clarity, that separation and that independence would be to the public good. I believe that it would be celebrated by the public, who would understand it more clearly.
	We will of course lose the experience and contributions of our Law Lord colleagues. I feel that with some sadness. For example, one has seen how powerfully the noble and learned Lord, Lord Scott of Foscote, has led the European scrutiny process. It is a sadness, but it is not a point of principle that would justify its continuation in the future.
	Under the current proposals set out in the White Paper, we will rejoice to receive the contribution of the existing members of the supreme court when they have completed their term of office and come back into our Chamber. It may well be that future members of the supreme court who are not appointed as Lords will nevertheless find that they are invited to become independent members of the House. I cannot forecast or foresay that. I do not believe that we will lose the great contributions that former members of the Appellate Committee or the Supreme Court can make, but we will get their contributions only when they are no longer acting as judges and are free to join us as legislators. That must be right in principle even though we will be sorry to see them go.
	I thank the noble Lord, Lord Alexander of Weedon, for rejoicing at an independent appointments commission. However, he made very clear his concern that if the Lord Chancellor went, we would be weakened, as he is the voice in government for the independence of the judiciary. That is an important issue, which has been raised by many speakers today.
	My noble and learned friend Lord Falconer is the Lord Chancellor at present; I believe he will be a distinguished Lord Chancellor and a distinguished Secretary of State when he is no longer Lord Chancellor. Merely giving a politician—because all Lord Chancellors are political appointments—the title of Lord Chancellor does not, I am afraid, defend the independence of the judiciary. That is self-evidently not automatically the case. Rather, I suggest that what we propose goes considerably further than anything proposed by any government before to preserve the independence of the judiciary. Let me enumerate that briefly.
	We propose that the ministerial role in the appointment of judges will be brought to an absolute minimum. We have put three options up for consultation. One, in response to the noble Lord, Lord Norton, and others, is that Ministers should have no involvement whatever. That would require a change to our constitutional conventions, as the Queen normally acts only on receipt of advice from her Ministers. However, it is in the consultation paper as an option, and if people think that is the right way forward, they should signal it clearly in their responses to us. It is an option; it is a perfectly possible and legitimate option, and we would pleased to hear from people who support it.
	It is not the option we recommend because we think that the Queen being advised by Ministers, who are thereby accountable to Parliament, can be preserved. The noble Earl, Lord Russell, is absolutely right that accountability to Parliament is one of the elements in defending the independence of the judiciary. Such a mechanism preserves the accountability to Parliament and we therefore think that that option has considerable merit.
	If that is the option being considered—and our minds are open to views and opinions—what should be the extent, if any, of ministerial discretion in the circumstances when the commission is making recommendations? Those are very important points of detail and principle, and we think it important to listen carefully to views and opinions on them.
	We have given a number of ideas in the paper so far; we very much hope that Members of this House and those outside will give further thoughts on the specifics as well. The devil is in the detail, and getting the detail right could lead to a model that contained accountability to Parliament as well as enshrining strong independence.
	Let me go further in terms of the Secretary of State for Constitutional Affairs. There is a very strong argument for giving a statutory responsibility and putting it beyond doubt that the Secretary of State has a responsibility—nay, a duty—to preserve the independence of the judiciary. Nothing would be lost by having such a responsibility and, in fact, the gain would be considerable. They would always have to have that in the forefront of their mind when they were acting. That, in a sense, has been the central thrust of the argumentation. The Lord Chancellor, in the historical embodiment, has had that role. How do we preserve that in the future? Some have said we should keep the Lord Chancellor. I must admit that I am not persuaded by the argument that we need to keep that particular historical figure or role, but I am interested in the argument that we need to entrench the responsibility within government for supporting and upholding the independence of the judiciary, because that is an important part of our constitution.
	Let me also signal why I think some of the concerns expressed are misplaced. The Secretary of State for Constitutional Affairs has a responsibility within government for looking across the constitution. He will shortly set out some of his thinking in this respect, and I hope it commands some public interest. He also has the leadership role on human rights, freedom of information and data protection. Much of the legislation emanating from the department is about the rights of minorities in our society. So there is a very strong coalition of interests and responsibilities in the current role of Lord Chancellor—the Secretary of State for Constitutional Affairs in the future—regarding the defence of rights of the independence of the judiciary and of our judicial system. That does not mean to say that our judicial system is perfect and should be preserved in aspic, as it currently is.
	A number of noble Lords touched on the importance of recognising that diversity, and the confidence that the public hold in the judiciary, need to be considered as part of the reforms. The noble Lord, Lord Taylor, made that point most strongly, but the noble Earl, Lord Russell, also made mention of those issues. They matter on three grounds. First, if one does not manage to attract more people as candidates to be selected only on merit, one is at risk of wasting talent. That is the classic business case for treating diversity seriously—otherwise, one misses out on talent.
	Secondly, there is straightforward human fairness. If one does not treat seriously people who have ability and talent, they are deprived of opportunity.
	Thirdly, confidence is a factor. Most of us will remember a time when newscasters on the BBC were only ever white males. That said something about our society. We have moved on from that time; for example, 15 per cent of medical consultants in Britain are from black and ethnic minority backgrounds; 1.2 per cent of judges are.
	In the legal profession, there have been a good proportion of women have come in as solicitors and barristers—about a third of each profession. I shall not give the figures for the higher levels of the judiciary. No one is saying is saying that we should move to any form of mad world of political correctness, but it is right that the system is asked to inspect itself and to consider why we have not succeeded in bringing forward into our system the talent that must exist in women or black and ethnic minority lawyers. That is one of the proposals before us as part of the consultation process.
	I am out of time, so I shall end by thanking again all who have contributed to the debate. Some very important issues have been raised about how we entrench in the constitution the duty to uphold the independence of the judiciary. However, I have not been changed in my view that there is a need for change, nor do I believe that many Members have argued against the need for change. The issue is how to get that detail right: to uphold the independence of the judiciary while making the judiciary one that the public increasingly respect and see as their defenders, because that respect is not at the level that we would wish at present.

House adjourned at twenty-six minutes before eleven o'clock.